The Intergenerational Transmission of Risk and Trust Attitudes

By Thomas J. Dohmen, Armin Falk, David Huffman, Uwe Sunde. Social Science Research Network, 2012

1,195 citations recorded by the source corpus.

Recent theories endogenize the attitude endowments of individuals, assuming that they are shaped by the attitudes of parents and other role models. This paper tests empirically for the relevance of three aspects of the attitude transmission process highlighted in this theoretical literature: (1) transmission of attitudes from parents to children; (2) an impact of prevailing attitudes in the local environment on child attitudes; and (3) positive assortative mating of parents, which enhances the ability of a parent to pass on his or her attitudes to the child. We focus on two fundamentally important attitudes, willingness to take risks and willingness to trust others. We find empirical support for all three aspects, providing an empirical underpinning for the literature. An investigation of underlying mechanisms shows that socialization is important in the transmission process. Various parental characteristics and aspects of family structure are found to strengthen the socialization process, with implications for modeling the socialization production function and for policies focused on affecting children’s non-cognitive skills. The paper also provides evidence that the transmission of risk and trust attitudes affects a wide variety of child outcomes, implying a potentially large total effect on children’s economic situation.

Subfields: Demography, Sociology and Political Science

View Paper: https://www.semanticscholar.org/paper/0125c4ba6f6ace54bee2e7316615a3649d0da704

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Citations in the corpus

Common components of risk and uncertainty attitudes across contexts and domains: evidence from 30 countries (2015, result): “In terms of correlations with losses, we nd that uncertainty averse choices in the gain domain predict uncertainty averse choices in the loss domain, in agreement with the ndings by Einav et al. (2012). We furthermore nd that survey measures of uncertainty attitudes (henceforth understood to include”
Genetic Variation in Preferences for Giving and Risk Taking (2009, background): “Dohmen et al. (2006), on the other hand, use survey evidence on attitudinal questions and nd modest intergenerational correlations in self-reported trust and risk attitudes.”
Perceived public support and entrepreneurship attitudes: A little reciprocity can go a long way! (2020, background): “…at the cultural context through Hofstede dimensions, future studies could apply other measures of cultural context, as well as consider other contextual differences related to macroeconomic developments (Malmendier & Nagel, 2011), legal systems or religion (Dohmen, Falk, Huffman, & Sunde, 2012).”
The Long Persistence of Regional Levels of Entrepreneurship: Germany, 1925–2005 (2014, background): “There is considerable empirical evidence that points towards a long-term persistence of informal institutions in general. BECKER et al. (2010), for instance, compare Eastern European regions that had been affiliated with the Habsburg Empire that existed until 1918 with regions that had not.”
Personality and marital surplus (2012, background): “Dohmen et al. (2005) show that the SOEP risk aversion measure predicts risk-taking behavior in investment, career choice, smoking, and other domains.”
Climate Risk, Cooperation and the Co-Evolution of Culture and Institutions (2017, result): “This view is consistent with recent empirical findings documenting the existence of a positive correlation in the propensity to trust between parents and children (Dohmen et al., 2012) and between second-generation immigrants and current inhabitants of the country of origin (Algan and Cahuc, 2010).”
Smoking Habits: Like Father, Like Son, Like Mother, Like Daughter (2010, positive): “Along these lines, Dohmen et al. (2006) document the existence of a strong intergenerational correlation in willingness to take health risks (among other types of risks), Becker and Mulligan (1997) show that parents devote resources to shaping their children’s discount rates and Knowles and…”
A Genetic Basis for Social Trust? (2010, background): “It is certainly intuitively plausible that individuals might select partners on the basis of how trusting they are and, indeed, Dohmen et al. (2006) report a between-parent trust correlation of 0.32 in the German socio-economic panel.”
Measuring Individual Risk Attitudes in the Lab: Task or Ask? An Empirical Comparison (2015, positive): “The data presented in this paper show that the general risk factor derived from a questionnaire about individual risk attitudes similar to the one used by Dohmen et al. (forthcoming) has good construct validity (being correlated with an external predictor of risk-taking behaviour, namely personality”
Families in Macroeconomics (2016, positive): “Empirical evidence for the intergenerational transmission of risk attitudes is provided by Dohmen et al. (2012). In Fernández, Fogli, and Olivetti (2004), men’s preferences for working versus stay-at-home wives are formed in childhood by the work behavior of their mothers.”