Vortragssitzung
Health Economic Aspects of Risk
Vorträge
Risk Preferences and Prosocial Behavior – Experimental Evidence in Pandemic Times
Benedicta Hermanns, HCHE/Universität Hamburg
Einleitung / Introduction
Every day, people are faced with situations where they have to weigh up the risk to their own health. Especially in times of a pandemic, decisions on risk do not only relate to oneself but can have far-reaching consequences for the health of others. By meeting other persons you not only risk infecting yourself but also being the one that infects others. This means that the interplay between risk preferences and prosocial behavior needs to be looked at more closely.
Methode / Method
To investigate how far prosocial behavior is related to risk preferences, we conducted a preregistered online experiment via Qualtrics with over 3,000 participants. We used the Infection Risk Elicitation Task (IRET) in order to elicit risk preferences and investigate whether the decisions made there differ if they can result in consequences for the community, meaning a donation made to the COVAX initiative by UNICEF was at risk. In the IRET, participants had to choose how many out of 25 persons they were willing to meet. Exact one of those persons was infected with the coronavirus. The participants monetarily benefit from meeting persons as long as they do not meet the infected person. In this case, they would face the risk of being infected themselves, resulting in a loss of their initially given endowment. In a second decision, the participants faced the same task, but the consequences did not limit to one’s own but also the community. For each participant, a donation was made as long as they did not meet the infected person. Otherwise, nothing would be donated. We controlled for the order of decisions in a second treatment. A third treatment controlled for possible realization effects, i.e., participants were only informed about the outcome of the first decision after the second decision was made. Since this experiment was conducted with participants of the European COvid Survey (ECOS), we are additionally able to match the experimental results with personal characteristics and a wide range of attitudes, e.g., towards adherence and vaccination. The study rollout in seven countries additionally enables us to conduct cross-country comparisons.
Ergebnisse / Results
Preliminary results show that participants behave as predicted: In general, the participants were risk averse, as they were not willing to meet many people. In addition, they met fewer people in the decision where the donation was at stake. Thus, their risk aversion increased even more if there were additional consequences for society associated with their decision. This pattern can be found throughout the included European countries. A closer look into the participant’s characteristics can lead to a more sophisticated understanding of how different types of people behave in decision-making under risk with regard to prosocial behavior.
AutorInnen
Benedicta Hermanns, HCHE/Universität Hamburg
Johanna Kokot, HCHE/Universität Hamburg
Risk-taking and background health risk
Björn Bos, Universität Hamburg
Einleitung / Introduction
We study how background health uncertainty induced by the COVID-19 pandemic affects individual risk-taking decisions. In an online panel experiment, werepeatedly elicit financial risk-taking of more than 5,000 participants. We exploit exogenous variation in infections and COVID-19 attributed deaths across time and space, and show that an increase in local infections and deaths decreases investments in a risky asset. We identify fear as an important mechanisms through which local pandemic prevalence reduces risk-taking, while expected and realized incomechanges are less important. Our results point towards an important role of background health uncertainty for financial risk-taking.
AutorInnen
Björn Bos
Moritz Drupp
Jasper Meya
Martin Quaas
Dynamics of Risk Preferences in the Context of the Covid-19 Pandemic: Evidence from seven European Countries
Johanna Kokot, Universität Hamburg, Hamburg Center for Health Economics
Einleitung / Introduction
Contact behavior became relevant during the current pandemic, and physical distancing became a valid measure to contain the incidence of infection. If people know they have had contact with an infected person, then individual action can be taken. The tracing apps are based on this principle. We want to know how people change their contact behavior when they are the first-degree contact of a person infected with the coronavirus. The second aim of our research is to find out to what extent mental accounting plays a role in these decisions under risk. Finally, we want to relate risk preferences to pandemic-specific behavior and compare this internationally.
Methode / Method
We have established an infection risk elicitation task as part of the European Covid Survey (ECOS) and recruited more than 2500 participants from 7 European countries. The participants were shown a field on which 25 persons were displayed. One of these persons was infected with the coronavirus. Participants were asked to choose how many people they wanted to meet. They benefited monetarily from each meeting. This was not the case if the infected person was among the persons met. Then they suffered a monetary loss. The more persons a participant meets, the more risk-taking he/she is. In our treatment condition, after the third of four rounds, we made participants aware of the consequences of their behavior up to that point, suggesting a separate mental accounting. Furthermore, we link the experimental data to socio-demographic variables and pandemic-related behavior and investigate whether risk preferences are heterogeneous across countries.
Ergebnisse / Results
Preliminary results suggest that, overall, individuals reduce risk-taking after meeting an infected person. Furthermore, we find indications of mental accounting: individuals' willingness to take risks decreases after starting a new account. We observe considerable heterogeneity among the seven countries considered. This applies to the absolute level of risk aversion and the reaction to the meeting of risk contacts. We also find heterogeneous interactions with pandemic-related behavior.
Zusammenfassung / Conclusion
Our study aims to investigate dynamic risk preferences: How do risk attitudes change after meeting a person with a coronavirus infection? Additionally, we are exploring the role of mental accounting in the dynamic decision-making of meeting potentially infected individuals. Specifically, we examine how people perceive the consequences of past pandemic behavior and whether they use different mental accounts to do so.