An overview of the existing literature on the topic of gender differences in risk aversion
| Study | Authors | Year | Focus | Methodology | Key findings | Contributions to or implications for gender differences | Conclusion on gender disparities in the degree of risk aversion |
|---|---|---|---|---|---|---|---|
| 1. Impatience and uncertainty: experimental decisions predict adolescents’ field behavior | Sutter et al. | 2013 | Risk attitudes, ambiguity attitudes, and time preferences of adolescents | Experiments with standard choice list tasks | Impatience is found to be a strong predictor of health-related field behavior and saving decisions, and that girls are more risk averse than boys | Offers new insights into the relationship between risk attitudes, ambiguity attitudes, and time preferences (i.e. impatience) | Females > Males |
| 2. Men, women and risk aversion: experimental evidence | Eckel and Grossman | 2008a, b | Experiments on risk aversion in the context of abstract gamble experiments, contextual environment experiments, and field experiments to find evidence of systematic gender differences | A review of the results from experimental measures of risk aversion | Explores risk aversion through a review of experiments, providing evidence of systematic differences in the behavior of men and women. In most studies, women are found to be more averse to risk than men | Provides invaluable insights into how men and women perceive and approach risky decisions | Females > Males |
| 3. Individual risk attitudes: measurement, determinants, and behavioral consequences | Dohmen et al. | 2011 | Relationship between individual risk attitudes, gender, and other demographics in different contexts | A large representative survey and a complementary experiment using paid lottery choices | Finds that gender, age, height, and parental background have economically significant impacts on willingness to take risks. Women are less willing to take risks than men, so women are more risk-averse | Gives insights into the diversity of risk preferences within populations, with attention to gender-specific patterns, and finds similar results on the determinants of risk attitudes in different contexts | Females > Males |
| 4. Strong evidence for gender differences in risk taking | Charness and Gneezy | 2012 | Gender differences in risk-taking in the context of financial decision making by using data assembled from 15 sets of experiments | Experiments with a simple underlying investment game | Presents robust findings on gender disparities in risk-taking behaviors, finding that women invest less, and therefore seem to be more financially risk-averse than men | Contributes empirical evidence to the discourse on gender differences in risk-taking behaviors in the context of financial decisions | Females > Males |
| 5. Dopamine and risk choices in different domains: findings among serious tournament bridge players | Dreber et al. | 2011 | Risk taking in the card game contract bridge, and economic risk taking as proxied by a financial gamble | Experiments including a card game and a financial gamble | Finds evidence that men take more overall risk in bridge than women, and strong evidence that men take more economic risk in an investment game. It also finds that the dopamine system plays an important role in explaining individual differences in risk taking | Identifies a strong interaction among desirable risk-taking behavior, measured success, and genetic variation | Females > Males |
| 6. Gender differences in social risk taking | Friedl et al. | 2020 | Risk taking in social contexts | Controlled experiments | Finds that inequality aversion is the main driver for risk aversion in social risk taking. This effect is mainly driven by strong inequality aversion of women | Concludes that gender differences in social risk taking are culture-specific, and that women are more risk-averse than men when payoffs are unequally distributed | Females > Males |
| 7. Who chooses annuities? An experimental investigation of the role of gender, framing, and defaults | Agnew et al. | 2008 | The role of gender, framing and defaults in risk attitudes among people facing financial decision about retirement plans | A controlled experiment | Discovers that women are more likely to choose annuities which is partly explained by differences in risk aversion and financial literacy | Contributes to the literature by studying the role of gender in important financial decisions such as retirement, and the choice between purchasing an annuity (a safe option) or investing savings (a risky option) on their own | Females > Males |
| 8. On the development of risk preferences: experimental evidence | Eckel et al. | 2011 | A field experiment eliciting the risk preferences among adolescents and examining various factors influencing the development of these risk preferences | A field experiment | Finds that girls are more risk-averse than boys, and also finds some evidence for a peer effect and a school-quality effect | Confirms that factors previously considered by economists (e.g. gender, ethnicity, height, and parental education) are found to be stronger determinants of risk preferences than those proposed by cognitive development theory and emotional development theory | Females > Males |
| 9. Gender differences in risk behavior in financial decision-making: an experimental analysis | Powell and Ansic | 1997 | Sensitivity of differences in risk preference to the framing of tasks and level of task familiarity to subjects | Computerized laboratory experiments | By examining gender differences in risk propensity and strategy in financial decision-making, it shows that women are less risk-seeking than men regardless of familiarity with tasks, task framing, costs, or ambiguity | Shows that the framing of tasks is not important in and that gender differences may arise in different framings of ambiguity. Women are more ambiguity-averse than men in the context of investment, but not in the context of insurance | Females > Males (in the context of investment) Females ∼ Males (in the context of insurance) |
| 10. Risk Aversion and Incentive Effects | Holt and Laury | 2002 | Risk aversion, incentive effects, payoff scale effect, introducing a menu of paired lottery choices, contrasting hypothetical and real payoffs, and fitting a hybrid power utility function with increasing relative and decreasing absolute risk aversion | An experiment including a menu of paired lottery choices | Finds evidence that, with usual low laboratory payoffs of several dollars, most subjects are risk-averse, and that scaling up all payoffs by factors of twenty to ninety makes little difference when the high payoffs are hypothetical, but a big difference when the payoffs are real, where subjects become more risk-averse | Creates a menu of paired lottery choices which is structured so that the switching point from risky choices to safe choices can be used to infer the degree of risk aversion. It also shows that men are slightly less risk-averse, but this gender effect fades away when payoffs become larger | Females > Males (in low-payoff settings) Females ∼ Males (in high-payoff settings) |
| 11. Financial Decision-Making: Are Women Really More Risk Averse? | Schubert et al. | 1999 | Financial decision-making under risk and gender differences in risk aversion and comparative risk propensity of male and female subjects in financial choices | An experiment with gambling decisions, and financially motivated risky decisions embedded in an investment or insurance context | Challenges stereotypes about women being more risk-averse | Finds that women do not generally make less risky financial choices than men. It also shows that the comparative risk propensity of male and female subjects in financial choices strongly depends on the decision frames and contexts, and that women were more risk-averse than men in the gain-domain frame, but the opposite holds true for the loss-domain gambles | Females > Males (in gain-domain gambles) Females < Males (in loss-domain gambles) |
| 12. Gender Differences in Preferences | Croson and Gneezy | 2009 | Gender differences in preferences (Risk taking, social preferences, and reaction to competition) | A survey of a series of economics experiments | Uncovers distinct inclinations and risk attitudes among men and women | Contributes to our understanding of how gender influences economic decision-making in three areas | Females > Males (in general) Females ∼ Males (among professionals) |
| 13. Does Knowledge of Finance Mitigate the Gender Difference in Financial Risk-Aversion? | Hibbert et al. | 2013 | The impact of financial knowledge on gender differences in financial risk-aversion by comparing finance professors’ portfolio allocations to those of respondents in the Federal Reserve’s Survey of Consumer Finances (SCF) | A survey of finance professors from US universities | Showing that, among highly educated individuals, women display higher levels of risk aversion, but with a high level of financial education, the gender difference in financial risk aversion diminishes, leading to equal likelihood in investing in risky assets for both men and women | Provides evidence on how general education and financial education influence the gender difference in financial risk aversion | Females > Males (among the highly educated) Females ∼ Males (among those with a high level of financial education) |
| 14. Gender Specific Attitudes towards Risk and Ambiguity: An Experimental Investigation | Schubert et al. | 2000 | Financial decision-making under ambiguity in probability information sets and gender differences in ambiguity aversion within investment and insurance contexts | A set of lottery experiments with three types of probability information in an investment or insurance context | Shows that the framing of information is important and that gender differences may arise in different framings of ambiguity. Women are more ambiguity-averse than men in the context of investment, but not in the context of insurance | Examines gender differences in ambiguity aversion, showing that women do not generally choose to make safer financial decisions than men, and that there are different forms of gender differences in different decision frames and contexts | Females ∼ Males (in terms of risk aversion) Females > Males (ambiguity aversion in the investment context) Females < Males (ambiguity aversion in the insurance context) |
| 15. Gender and Risk: Women, Risk Taking and Risk Aversion | Maxfield et al. | 2010 | Exploring women’s risk taking and reasons for stereotype persistence | Survey (Uses the Simmons Gender and Risk Survey database of 661 female managers) | Finds evidence of gender neutrality in risk propensity and decision-making in several managerial contexts other than portfolio allocation | Provides insights into how context can influence gender differences in risk taking and synthesizes evidence on risk taking and gender in different contexts | Females ∼ Males (in all contexts but portfolio allocation) Females > Males (in the context of portfolio allocation) |
| 16. Gender Effects for Loss Aversion: Yes, No, Maybe? | Bouchouicha et al. | 2019 | Gender differences in loss aversion in terms of four different definitions of loss aversion | Used data from Vieider et al. (2016), which, in turn, used controlled experiments in 30 countries to estimate certainty equivalents using lotteries | Indicates that across various definitions of loss aversion, males tend to exhibit greater aversion to losses than females in most cases. In other definitions, either females display higher levels of loss aversion, or the observed difference is statistically insignificant | Employs four definitions of loss aversion in the literature to investigate gender effects in loss aversion, showing that gender differences are sensitive to the definition of loss aversion used in an experiment | Females < Males (in case of 2 definitions of loss aversion) Females > Males (in terms of 1 definition of loss aversion) Females ∼ Males (in terms of 1 definition of loss aversion) |
| 17. Risk aversion for Decisions under Uncertainty: Are There Gender Differences? | Sarin and Wieland | 2016 | Peoples’ subjective probabilities and gender differences in risk aversion | Five different experiments including games of chance and BDM procedures | Finds that men and women value bets similarly both before and after controlling for subjective probabilities, so women are not more risk-averse than men for bets on real events | Introduces a method that controls for subjective probability in comparing gender differences in risk aversion. It also finds that subjective probability is the main driver of valuation for people when making decisions under uncertainty | Females ∼ Males |
| 18. Estimating Risk Attitudes in Denmark: A Field Experiment | Harrison et al. | 2007 | Studying individual risk attitudes in Denmark through controlled experiments using a representative sample and considering a multitude of socio-demographic characteristics | Controlled experiments in the field | Exploration of a multitude of socio-demographic characteristics in identifying gender differences in risk aversion, finding that men and women are not statistically significantly different in their degrees of risk aversion | Finds that the average Dane is risk-averse, and that risk attitudes vary significantly with respect to several important socio-demographic variables | Females ∼ Males |
| 19. Attitudes toward Risk: Theoretical Implications of an Experiment in Rural India | Binswanger | 1981 | Risk aversion among farmers in India | Large-Scale field experiments with MCL-like experimental designs | Finds that most farmers exhibit a considerable degree of risk aversion that has a tendency to increase as payoffs are scaled up, and that most individuals have very similar levels of risk aversion, and that wealth has trivial effect on the degree of risk aversion and years of schooling reduce the extent of risk aversion | Creates one of the first MCL experimental designs ever to infer risk attitudes and check a multitude of demographics such as gender, wealth, and years of schooling | Females ∼ Males |
| 20. Gender Differences in Risk Behavior: An Analysis of Asset Allocation Decisions in Ghana | Hillesland | 2019 | Gender differences in risk preferences through an analysis of asset allocation decisions in the context of a developing country | National surveys and a decomposition method | Contributes to the understanding of national-representative sex-disaggregated data with self-reported asset ownership and wealth information of individuals, finding that men and women are not statistically significantly different in their degrees of risk aversion | Provides insights into gender differences in risk preferences within a developing country | Females ∼ Males |
| Study | Authors | Year | Focus | Methodology | Key findings | Contributions to or implications for gender differences | Conclusion on gender disparities in the degree of risk aversion |
|---|---|---|---|---|---|---|---|
| 1. Impatience and uncertainty: experimental decisions predict adolescents’ field behavior | Sutter | Risk attitudes, ambiguity attitudes, and time preferences of adolescents | Experiments with standard choice list tasks | Impatience is found to be a strong predictor of health-related field behavior and saving decisions, and that girls are more risk averse than boys | Offers new insights into the relationship between risk attitudes, ambiguity attitudes, and time preferences (i.e. impatience) | Females > Males | |
| 2. Men, women and risk aversion: experimental evidence | Eckel and Grossman | Experiments on risk aversion in the context of abstract gamble experiments, contextual environment experiments, and field experiments to find evidence of systematic gender differences | A review of the results from experimental measures of risk aversion | Explores risk aversion through a review of experiments, providing evidence of systematic differences in the behavior of men and women. In most studies, women are found to be more averse to risk than men | Provides invaluable insights into how men and women perceive and approach risky decisions | Females > Males | |
| 3. Individual risk attitudes: measurement, determinants, and behavioral consequences | Dohmen | Relationship between individual risk attitudes, gender, and other demographics in different contexts | A large representative survey and a complementary experiment using paid lottery choices | Finds that gender, age, height, and parental background have economically significant impacts on willingness to take risks. Women are less willing to take risks than men, so women are more risk-averse | Gives insights into the diversity of risk preferences within populations, with attention to gender-specific patterns, and finds similar results on the determinants of risk attitudes in different contexts | Females > Males | |
| 4. Strong evidence for gender differences in risk taking | Charness and Gneezy | Gender differences in risk-taking in the context of financial decision making by using data assembled from 15 sets of experiments | Experiments with a simple underlying investment game | Presents robust findings on gender disparities in risk-taking behaviors, finding that women invest less, and therefore seem to be more financially risk-averse than men | Contributes empirical evidence to the discourse on gender differences in risk-taking behaviors in the context of financial decisions | Females > Males | |
| 5. Dopamine and risk choices in different domains: findings among serious tournament bridge players | Dreber | Risk taking in the card game contract bridge, and economic risk taking as proxied by a financial gamble | Experiments including a card game and a financial gamble | Finds evidence that men take more overall risk in bridge than women, and strong evidence that men take more economic risk in an investment game. It also finds that the dopamine system plays an important role in explaining individual differences in risk taking | Identifies a strong interaction among desirable risk-taking behavior, measured success, and genetic variation | Females > Males | |
| 6. Gender differences in social risk taking | Friedl | Risk taking in social contexts | Controlled experiments | Finds that inequality aversion is the main driver for risk aversion in social risk taking. This effect is mainly driven by strong inequality aversion of women | Concludes that gender differences in social risk taking are culture-specific, and that women are more risk-averse than men when payoffs are unequally distributed | Females > Males | |
| 7. Who chooses annuities? An experimental investigation of the role of gender, framing, and defaults | Agnew | The role of gender, framing and defaults in risk attitudes among people facing financial decision about retirement plans | A controlled experiment | Discovers that women are more likely to choose annuities which is partly explained by differences in risk aversion and financial literacy | Contributes to the literature by studying the role of gender in important financial decisions such as retirement, and the choice between purchasing an annuity (a safe option) or investing savings (a risky option) on their own | Females > Males | |
| 8. On the development of risk preferences: experimental evidence | Eckel | A field experiment eliciting the risk preferences among adolescents and examining various factors influencing the development of these risk preferences | A field experiment | Finds that girls are more risk-averse than boys, and also finds some evidence for a peer effect and a school-quality effect | Confirms that factors previously considered by economists (e.g. gender, ethnicity, height, and parental education) are found to be stronger determinants of risk preferences than those proposed by cognitive development theory and emotional development theory | Females > Males | |
| 9. Gender differences in risk behavior in financial decision-making: an experimental analysis | Powell and Ansic | Sensitivity of differences in risk preference to the framing of tasks and level of task familiarity to subjects | Computerized laboratory experiments | By examining gender differences in risk propensity and strategy in financial decision-making, it shows that women are less risk-seeking than men regardless of familiarity with tasks, task framing, costs, or ambiguity | Shows that the framing of tasks is not important in and that gender differences may arise in different framings of ambiguity. Women are more ambiguity-averse than men in the context of investment, but not in the context of insurance | Females > Males (in the context of investment) | |
| 10. Risk Aversion and Incentive Effects | Holt and Laury | Risk aversion, incentive effects, payoff scale effect, introducing a menu of paired lottery choices, contrasting hypothetical and real payoffs, and fitting a hybrid power utility function with increasing relative and decreasing absolute risk aversion | An experiment including a menu of paired lottery choices | Finds evidence that, with usual low laboratory payoffs of several dollars, most subjects are risk-averse, and that scaling up all payoffs by factors of twenty to ninety makes little difference when the high payoffs are hypothetical, but a big difference when the payoffs are real, where subjects become more risk-averse | Creates a menu of paired lottery choices which is structured so that the switching point from risky choices to safe choices can be used to infer the degree of risk aversion. It also shows that men are slightly less risk-averse, but this gender effect fades away when payoffs become larger | Females > Males (in low-payoff settings) | |
| 11. Financial Decision-Making: Are Women Really More Risk Averse? | Schubert | Financial decision-making under risk and gender differences in risk aversion and comparative risk propensity of male and female subjects in financial choices | An experiment with gambling decisions, and financially motivated risky decisions embedded in an investment or insurance context | Challenges stereotypes about women being more risk-averse | Finds that women do not generally make less risky financial choices than men. It also shows that the comparative risk propensity of male and female subjects in financial choices strongly depends on the decision frames and contexts, and that women were more risk-averse than men in the gain-domain frame, but the opposite holds true for the loss-domain gambles | Females > Males (in gain-domain gambles) | |
| 12. Gender Differences in Preferences | Croson and Gneezy | Gender differences in preferences (Risk taking, social preferences, and reaction to competition) | A survey of a series of economics experiments | Uncovers distinct inclinations and risk attitudes among men and women | Contributes to our understanding of how gender influences economic decision-making in three areas | Females > Males (in general) | |
| 13. Does Knowledge of Finance Mitigate the Gender Difference in Financial Risk-Aversion? | Hibbert | The impact of financial knowledge on gender differences in financial risk-aversion by comparing finance professors’ portfolio allocations to those of respondents in the Federal Reserve’s Survey of Consumer Finances (SCF) | A survey of finance professors from US universities | Showing that, among highly educated individuals, women display higher levels of risk aversion, but with a high level of financial education, the gender difference in financial risk aversion diminishes, leading to equal likelihood in investing in risky assets for both men and women | Provides evidence on how general education and financial education influence the gender difference in financial risk aversion | Females > Males (among the highly educated) | |
| 14. Gender Specific Attitudes towards Risk and Ambiguity: An Experimental Investigation | Schubert | Financial decision-making under ambiguity in probability information sets and gender differences in ambiguity aversion within investment and insurance contexts | A set of lottery experiments with three types of probability information in an investment or insurance context | Shows that the framing of information is important and that gender differences may arise in different framings of ambiguity. Women are more ambiguity-averse than men in the context of investment, but not in the context of insurance | Examines gender differences in ambiguity aversion, showing that women do not generally choose to make safer financial decisions than men, and that there are different forms of gender differences in different decision frames and contexts | Females ∼ Males (in terms of risk aversion) | |
| 15. Gender and Risk: Women, Risk Taking and Risk Aversion | Maxfield | Exploring women’s risk taking and reasons for stereotype persistence | Survey (Uses the Simmons Gender and Risk Survey database of 661 female managers) | Finds evidence of gender neutrality in risk propensity and decision-making in several managerial contexts other than portfolio allocation | Provides insights into how context can influence gender differences in risk taking and synthesizes evidence on risk taking and gender in different contexts | Females ∼ Males (in all contexts but portfolio allocation) | |
| 16. Gender Effects for Loss Aversion: Yes, No, Maybe? | Bouchouicha | Gender differences in loss aversion in terms of four different definitions of loss aversion | Used data from | Indicates that across various definitions of loss aversion, males tend to exhibit greater aversion to losses than females in most cases. In other definitions, either females display higher levels of loss aversion, or the observed difference is statistically insignificant | Employs four definitions of loss aversion in the literature to investigate gender effects in loss aversion, showing that gender differences are sensitive to the definition of loss aversion used in an experiment | Females < Males (in case of 2 definitions of loss aversion) | |
| 17. Risk aversion for Decisions under Uncertainty: Are There Gender Differences? | Sarin and Wieland | Peoples’ subjective probabilities and gender differences in risk aversion | Five different experiments including games of chance and BDM procedures | Finds that men and women value bets similarly both before and after controlling for subjective probabilities, so women are not more risk-averse than men for bets on real events | Introduces a method that controls for subjective probability in comparing gender differences in risk aversion. It also finds that subjective probability is the main driver of valuation for people when making decisions under uncertainty | Females ∼ Males | |
| 18. Estimating Risk Attitudes in Denmark: A Field Experiment | Harrison | Studying individual risk attitudes in Denmark through controlled experiments using a representative sample and considering a multitude of socio-demographic characteristics | Controlled experiments in the field | Exploration of a multitude of socio-demographic characteristics in identifying gender differences in risk aversion, finding that men and women are not statistically significantly different in their degrees of risk aversion | Finds that the average Dane is risk-averse, and that risk attitudes vary significantly with respect to several important socio-demographic variables | Females ∼ Males | |
| 19. Attitudes toward Risk: Theoretical Implications of an Experiment in Rural India | Binswanger | Risk aversion among farmers in India | Large-Scale field experiments with MCL-like experimental designs | Finds that most farmers exhibit a considerable degree of risk aversion that has a tendency to increase as payoffs are scaled up, and that most individuals have very similar levels of risk aversion, and that wealth has trivial effect on the degree of risk aversion and years of schooling reduce the extent of risk aversion | Creates one of the first MCL experimental designs ever to infer risk attitudes and check a multitude of demographics such as gender, wealth, and years of schooling | Females ∼ Males | |
| 20. Gender Differences in Risk Behavior: An Analysis of Asset Allocation Decisions in Ghana | Hillesland | Gender differences in risk preferences through an analysis of asset allocation decisions in the context of a developing country | National surveys and a decomposition method | Contributes to the understanding of national-representative sex-disaggregated data with self-reported asset ownership and wealth information of individuals, finding that men and women are not statistically significantly different in their degrees of risk aversion | Provides insights into gender differences in risk preferences within a developing country | Females ∼ Males |
Note(s): “Females > Males” means women are found to be more risk-averse than men. “Females < Males” means the opposite. And finally, “Females ∼ Males” means the difference between their degrees of risk aversion is found to be statistically insignificant
Source(s): Author’s own work