Risk aversion and social networks
The result's identifiers
Result code in IS VaVaI
<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F67985998%3A_____%2F14%3A00445236" target="_blank" >RIV/67985998:_____/14:00445236 - isvavai.cz</a>
Result on the web
<a href="http://dx.doi.org/10.1515/rne-2014-0029" target="_blank" >http://dx.doi.org/10.1515/rne-2014-0029</a>
DOI - Digital Object Identifier
<a href="http://dx.doi.org/10.1515/rne-2014-0029" target="_blank" >10.1515/rne-2014-0029</a>
Alternative languages
Result language
angličtina
Original language name
Risk aversion and social networks
Original language description
This paper first investigates empirically the relationship between risk aversion and social network structure in a large group of undergraduate students. We find that risk aversion is strongly correlated to local network clustering, that is, the probability that one has a social tie to friends of friends. We then propose a network formation model that generates this empirical finding, suggesting that locally superior information on benefits makes it more attractive for risk averse individuals to link tofriends of friends. Finally, we discuss implications of this model. The model generates a positive correlation between local network clustering and benefits, even if benefits are distributed independently ex ante. This provides an alternative explanation of this relationship to the one given by the social capital literature. We also establish a linkage between the uncertainty of the environment and the network structure: risky environments generate more clustered and more unequal networ
Czech name
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Czech description
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Classification
Type
J<sub>x</sub> - Unclassified - Peer-reviewed scientific article (Jimp, Jsc and Jost)
CEP classification
AH - Economics
OECD FORD branch
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Result continuities
Project
<a href="/en/project/GA14-22044S" target="_blank" >GA14-22044S: Learning and Networks</a><br>
Continuities
I - Institucionalni podpora na dlouhodoby koncepcni rozvoj vyzkumne organizace
Others
Publication year
2014
Confidentiality
S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů
Data specific for result type
Name of the periodical
Review of Network Economics
ISSN
2194-5993
e-ISSN
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Volume of the periodical
13
Issue of the periodical within the volume
2
Country of publishing house
DE - GERMANY
Number of pages
35
Pages from-to
121-155
UT code for WoS article
000350736500001
EID of the result in the Scopus database
2-s2.0-84925450018