Risk preferences in New Yorkers’ everyday decisions. Correlation of risk preferences across different decision-making domains.
Most of the important decisions that we make in life are made under conditions of uncertainty. When deciding about the investment strategy in the stock market, an individual does not know with certainty what his monetary returns on the investments will be. Similarly, a person choosing a medical treatment cannot be sure whether it will be successful or not. An adolescent deciding whether to engage in unprotected sex does not know for sure if it will end up in pregnancy, and/or STD or have no undesirable consequences at all. Individual preferences shape these decisions. At the current state of the literature, it is unclear however if individual preferences in one domain of decision-making, such as financial, are predictive of the individual decision-making in another domain, for example health or social. So far researchers addressed this question using questionnaires, obtaining somewhat conflicting results . Here we propose to take advantage of the rich variety of decisions made by New Yorkers everyday, to assess whether risk attitudes across different domains of decision-making are correlated within individuals.