Arno Riedl : "The Convergent and External Validity of Risk and Time Preference Elicitation Methods: Evidence from a Large Population Sample" (joint work with Paul Bokern, Jona Linde, Hans Schmeets, and Peter Werner)

On The November 26, 2024

Cité Scientifique Campus - Villeneuve d'Ascq - Salle du conseil
and online on Zoom.

4.30 - 5.30 pm

® Chris Liverani - Unsplash
® Chris Liverani - Unsplash

As part of the Lille Economie Management laboratory's (LEM) seminar, Arno Riedl, researcher in residence at the Collegium, will present his research : "The Convergent and External Validity of Risk and Time Preference Elicitation Methods: Evidence from a Large Population Sample" (joint work with Paul Bokern, Jona Linde, Hans Schmeets, and Peter Werner).

 

Abstract:
"We evaluate the convergent and external validity of commonly used risk and time preference elicitation methods with and without controlling for measurement error using the obviously related instrumental variable (ORIV) approach (Gillen et al. 2019). Risk and time preferences are elicited in a large sample of the Dutch population (N=4,282) and linked to field behavior in financial, occupational, and health domains based on register data and survey questions. We find that controlling for measurement error improves the correlation between the methods for both types of preferences, suggesting, among other things, that not accounting for measurement error can partly explain the lack of convergent validity among risk preference elicitation methods found in previous studies. At the same time, we find clear differences between revealed and stated risk preference methods in terms of their external validity. Stated risk preferences correlate well with most types of field behavior and correlations are of economic significance. In addition, controlling for measurement error increases the strength of the relationships found. Revealed risk preferences are at best weakly related to field behavior, even when controlling for measurement error. Moreover, we find that revealed time preferences are significantly correlated with different types of financial behavior. For stated time preferences, we find similar effects; in addition, these preferences are also significantly linked to occupational choice and a measure for health-related behavior."


Zoom link

Arno Riedl studied economics at the University of Vienna. He is professor of public economics at Maastricht University. In his research he uses an interdisciplinary approach to investigate human behavior.

LEM website