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Countercyclical risk aversion: Beyond financial professionals

Koenig-Kersting,Christian
; 
Trautmann,Stefan T.
Abstract
We test if Cohn et al.'s (2015) experimental results on countercyclical risk aversion exhibited by financial professionals generalize to a standard student sample. In our sample, we do not find an effect of stock market bust or boom on subjects' investments. We do not find a systematic emotional reaction, nor do we find an effect of variation in the emotional state (especially fear) on investment. Our results add to the literature documenting behavioral differences between financial professionals and non-professionals and, taking a policy perspective, underline the need for careful external validity checks of single sample experiments. (C) 2018 Elsevier B.V. All rights reserved.
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Date
2018-06
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Tilburg University Research Output Collection
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Keywords
Risk aversion, Business cycle, Priming, OPTIMISM
Citation
Koenig-Kersting, C & Trautmann, S T 2018, 'Countercyclical risk aversion : Beyond financial professionals', Journal of Behavioral and Experimental Finance, vol. 18, pp. 94-101. https://doi.org/10.1016/j.jbef.2018.03.001
URI
https://hdl.handle.net/20.500.14602/69718
License
info:eu-repo/semantics/restrictedAccess
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