Risk preferences play a crucial role in a great variety of economic decisions. Measuring risk preferences reliably is therefore an important challenge. In this paper we ask the question whether risk preferences observed in economic experiments reflect real-life risky choice behaviour. We investigate in a sample representative for a rural region of eastern Uganda whether pursuing farming strategies with both a higher expected profit and greater variance of profits is associated with willingness to take risks in an experiment.
This is an output from ‘A Behavioural Economic Analysis of Agricultural Investment Decisions in Uganda’ project.
Arjan Verschoor, Ben D’Exelle, Borja Perez-Viana. (2016) Lab and life: Does risky choice behaviour observed in experiments reflect that in the real world?, Journal of Economic Behavior & Organization, Volume 128, 2016, Pages 134-148,
Lab and Life: Does risky choice behaviour observed in experiments reflect that in the real world?