Date of this Version

June 1992

Document Type

Discussion Paper

Publication Details

Tapen Sinha (1992) Are Older People More Risk Averse?

Acknowledgement: I am indebted to Shari Due for writing the computer program for the interactive method used to determine the certainty equivalent sum. Comments from Rebecca Benedict, Tom Lee and Uri Ben-Zion are gratefully acknowledged. I would like to thank all the participants of the experiment. Without their time and effort, this research would not have been possible. However, all the remaining errors are mine alone.

School of Business Discussion Paper ; No. 32, Jun. 1992

© Copyright Tapen Sinha and the School of Business, Bond University

Abstract

In a laboratory experiment, I used an interactive method to determine the effects of difference in ages on risk taking. Two sets of subjects were chosen: one group was "young" (mean age 21) another group was "old" (mean age 65), I found risk (loss) aversion for monetary gains (losses) were higher for older people. The implications of the result given the population aging are explored.

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