Replication data for: The Nature of Risk Preferences: Evidence from Insurance Choices
Principal Investigator(s): View help for Principal Investigator(s) Levon Barseghyan; Francesca Molinari; Ted O'Donoghue; Joshua C. Teitelbaum
Version: View help for Version V1
| Name | File Type | Size | Last Modified |
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| 20110834_data_files | 12/06/2019 04:10:PM | ||
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text/plain | 14.6 KB | 12/06/2019 11:10:AM |
Project Citation:
Barseghyan, Levon, Molinari, Francesca, O’Donoghue, Ted, and Teitelbaum, Joshua C. Replication data for: The Nature of Risk Preferences: Evidence from Insurance Choices. Nashville, TN: American Economic Association [publisher], 2013. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2019-12-06. https://doi.org/10.3886/E116116V1
Project Description
Summary:
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We use data on insurance deductible choices to estimate a structural
model of risky choice that incorporates "standard" risk aversion
(diminishing marginal utility for wealth) and probability distortions.
We find that probability distortions—characterized by substantial
overweighting of small probabilities and only mild insensitivity to
probability changes—play an important role in explaining the aversion
to risk manifested in deductible choices. This finding is robust to
allowing for observed and unobserved heterogeneity in preferences.
We demonstrate that neither Köszegi-Rabin loss aversion alone nor
Gul disappointment aversion alone can explain our estimated probability
distortions, signifying a key role for probability weighting.
Scope of Project
JEL Classification:
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D14 Household Saving; Personal Finance
D81 Criteria for Decision-Making under Risk and Uncertainty
G22 Insurance; Insurance Companies; Actuarial Studies
D14 Household Saving; Personal Finance
D81 Criteria for Decision-Making under Risk and Uncertainty
G22 Insurance; Insurance Companies; Actuarial Studies
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