Risk Aversion at the Country Level

By Néstor Gandelman, Rubén Hernández-Murillo. 2015

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In this paper we provide estimates of the coefficient of relative risk aversion for 80 countries using data on self-reports of personal well-being from the Gallup World Poll. For most countries we cannot reject the null hypothesis that the coefficient of relative risk aversion equals 1. We conclude that our result supports the use of the log utility function in numerical simulations.

Subfields: Economics and Econometrics, Social Psychology

View Paper: https://www.semanticscholar.org/paper/726710bb6793c48c11100dbfd01c40bedb641889