Assortative mating on risk attitude

Bacon, Philomena, Conte, Anna and Moffatt, Peter (2014) Assortative mating on risk attitude. Theory and Decision, 77 (3). pp. 389-401. ISSN 0040-5833

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Abstract

Spousal correlation in risk attitude is estimated using data from the German Socio-Economic Panel over the period 2004–2009. We apply the bivariate panel ordered probit model to the analysis of the simultaneous determination of the male’s and the female’s risk attitude, using the survey question about general willingness to take risk, provided on a 0–10 Likert-scale. The correlations between both the individual-specific effects of the two partners and the two within-individual errors are separately estimated, and found to be +0.285 and +0.310, respectively. We consider the former to be a key parameter, since its positive sign may be interpreted in terms of positive assortative mating on risk attitude: individuals tend to form partnerships with others having a similar risk attitude. We also find evidence that this correlation increases with years of marriage, suggesting either a form of spousal socialization or a selection process in which marriage breakdown is more likely in poorly matched couples.

Item Type:	Article
Additional Information:	Available under Open Access
Uncontrolled Keywords:	multiple equation models,ordinal data,panel data,risk attitude,assortative mating,spousal correlation,homophily
Faculty \ School:	Faculty of Science > School of Environmental Sciences Faculty of Social Sciences > School of Economics
UEA Research Groups:	Faculty of Social Sciences > Research Groups > Industrial Economics Faculty of Social Sciences > Research Groups > Applied Econometrics And Finance Faculty of Social Sciences > Research Centres > Centre for Behavioural and Experimental Social Sciences Faculty of Social Sciences > Research Groups > Behavioural Economics
Depositing User:	Pure Connector
Date Deposited:	05 Aug 2014 15:54
Last Modified:	19 Mar 2024 16:30
URI:	https://ueaeprints.uea.ac.uk/id/eprint/49652
DOI:	10.1007/s11238-014-9448-x

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