Risk Preference Predictions and Gender Stereotypes

Abstract

This article reports a study examining biases in predicting the risk preferences of other people. Results showed that both women and men overestimated males' risk preferences, but accurately predicted women's risk preferences. The same effect was observed for options with positive outcomes and for options with negative outcomes. Results of our research suggest that participants' predictions were influenced by knowledge about risk preferences incorporated in gender stereotypes and by their own feelings. People are especially prone to make biased predictions when they compare themselves with other men. Previous findings that people are less risk averse for losses than for gains were successfully replicated. Practical and theoretical implications of the findings are discussed.