Three Papers on Risk and Personality 公开
Jiang, Bing (2013)
Abstract
Experimental studies of choice under risk show that there exists a large amount of heterogeneity in how people perceive risk. Despite of this, little effort has been made to identify the source of such heterogeneity. This study explores the possibility that the distinguishing personality profile of the decision-maker is linked to heterogeneity in risk preference. Using data from incentivized choice experiments combined with validated psychological questionnaires, I establish three interesting results. First, people can be clustered into distinct personality types and different types may have different risk preferences: the motivated view gambling more attractive, whereas the impulsive are the most capable of discriminating non-extreme probabilities. Second, individuals who score higher on future goal-orientation & fun-seeking trait are less risk seeking and more patient, while reward-driven individuals are less patient. Third, there also exists a correlation between personality and entrepreneurship: entrepreneurs are shown to be significantly more motivated than non-entrepreneurs. In addition, the trait of motivation is positively associated with one's probability of becoming an entrepreneur, whereas the trait of reward-driven is negatively related to such probability. These results suggest that the observed heterogeneity in risk preference may be explained by personality profiles, which can be elicited though standard psychological questionnaires. I believe these findings have important implications for understanding decision-making under risk, as well as informing economic theories and government policies.
Table of Contents
Chapter 1: Can Personality Type Explain Probability Distortions? 1
1.1 Introduction 3
1.2 Experimental Design and Procedures 8
1.2.1 Certainty Equivalents and Structural Estimation 9
1.2.2 Psychological Questionnaires 12
1.3 Results 14
1.4 Discussion 17
References 19
Chapter 2: Are Entrepreneurs A Different Breed? 37
2.1 Introduction 39
2.2 Design and Procedures 41
2.2.1 Eliciting Risk Preferences 45
2.2.2 Eliciting Time Preferences 47
2.2.3 Psychological Questionnaires 51
2.3 Results 53
2.3.1 Description of the Data 53
2.3.2 Differences between Entrepreneurs and Non-entrepreneurs 56
2.4 Discussion 59
References 63
Chapter 3: Understanding the Entrepreneurial Personality 88
3.1 Introduction 90
3.2 Design and Procedures 96
3.2.1 General Design 96
3.2.2 Psychological Questionnaires 98
3.3 Results 100
3.3.1 Description of the Data 100
3.3.2 Statistical Analysis 101
3.3.2.1 Entrepreneurship and Personality 103
3.3.2.2 Entrepreneurial Process and Personality 104
3.4 Discussion 104
References 106
Table of Contents: List of Tables
Chapter1: Can Personality Type Explain Probability Distortions? 1
Table 1.1 Population Estimates 26
Table 1.2 Factor Loadings and Uniqueness Scores 27
Table 1.3 Summary Statistics of Estimated Mean and Median Risk Parameters by PersType 28
Appendix: Chart A Estimates of Individual Risk Parameters and Demographics 32
Appendix: Chart B Description of Variables (47 Subjects) 34
Appendix: Chart C Summary Statistics by Personality Type (47 Subjects) 35
Chapter 2: Are Entrepreneurs A Different Breed? 37
Table 2.1.1 Subject Responses in the Risk Decision Tasks 71
Table 2.1.2 Risk Parameters Approximations 71
Table 2.2 Descriptive Statistics for Subject Responses in the Time Decision Task 72
Table 2.3 Rotated Factor Loadings and Uniqueness Scores Parameters by PersType 73
Table 2.4 Pair-wise Correlations with Traits Parameters by PersType 74
Table 2.5.1 Characteristic Differences between Entrepreneurs and Non-entrepreneurs Parameters by PersType 75
Table 2.5.2 Decision Tasks Responses for Entrepreneurs and Non-entrepreneurs 75
Table A.2.1 Risk Decision Task Series 1 79
Table A.2.2 Risk Decision Task Series 2 79
Table A.2.3 Risk Decision Task Series 3 80
Table A.2.4 Switching Points in Task 1, 2, and 3, and Risk Approximations 81
Table A.2.5 Time Decision Task (Task 4) 82
Table A.2.6 Description of Variables (80 Subjects) 83
Table A.2.7 Regression Models of the Effects on Risk Decision Tasks Responses 85
Table A.2.8 Regression Models of the Effects on Approximated Risk Parameters 86
Table A.2.9 Regression Models of the Effects on Time Preferences Parameters 87
Chapter 3: Understanding the Entrepreneurial Personality 88
Table 3.1 Rotated Factor Loadings and Uniqueness Scores 114
Table 3.2 Marginal Effects on Pr (Entrepreneur) 115
Table 3.3 Correlations between Entrepreneurial Process and Personality 116
Table A.3.1 Description of Variables (80 Subjects) 119
Table A.3.2 Regression Models of the Effects on Pr (Entrepreneur) 121
Table of Contents: List of Figures
Chapter 1: Can Personality Type Explain Probability Distortions? 1
Figure 1.1 Typical One-parameter Probability Weighting Functions 29
Figure 1.2 Examples of Lottery Choices 30
Figure 1.3 Examples of Subjects with Different Curvature (Top) and Elevation (Bottom) 31
Chapter 2: Are Entrepreneurs A Different Breed? 37
Figure 2.1 One-parameter Prelec (1998)'s Probability Weighting Functions 76
Figure 2.2 Distributions of Subject Time Task Responses 77
Figure 2.3 Distributions of Risk Tasks Responses for Entrepreneurs and Non-entrepreneurs 78
Chapter 3: Understanding the Entrepreneurial Personality 88
Figure 3.1 Dendrogram for Cluster Analysis 117
Figure 3.2 Determinants of Pr (Entrepreneur) 118
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