A menu of paired lottery choices is structured so that the crossover point to the high-risk lottery can be used to infer the degree of risk aversion. With "normal " laboratory payoffs of several dollars, most subjects are risk averse and few are risk loving. Scaling up all payoffs

more risk-tolerant (as holds in the sample of individuals we surveyed), the principal can screen agents and bolster target efficiency by offering a choice between a nonrandom budget and a two-outcome risky budget. When, at very low allocations, the ratio of the more risk-averse type’s marginal utility

Lear ning to be Risk Averse?

Lear ning to be Risk Averse?

are lotteries valued less? Multiple tests of a direct

This article uses life insurance data to estimate the Pratt-Arrow coefficient of relative risk aversion for each of nearly 2,400 households. Attitudinal differences toward pure risk are then examined across demographic subgroups. Additionally, differences in speculative risk-taking are examined

Economics can be distinguished from other social sciences by the belief that most (all?) behavior can be explained by assuming that rational agents with I stable, well-<lefined preferences interact in markets that (eventually) clear. An empirical result qualifies as an anomaly if it i ~ difficult to "rationalize " or if implausible assumptions are necessary to explain it within the paradigm. Suggestions for future topics should be sent to Richard Thaler, c/oJournal of Economic

This paper develops a framework for deriving and inferring the distribution of relative risk aversion from financial markets. The theoretical constructions (i) rely on a fairly robust form of aggregating the marginal rate of substitution of individuals that are either long or short the market

Diminishing Marginal utility, expected utility, risk aversion

Risk aversion is introduced into a traditional model of a contest where there is a prize for the most aggressive player and where there is complete information. Players only differ by their aversion to risk. Aggression is defined as expenditure on attempting to win the prize. It is shown that total