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Federal Reserve Bank of St. Louis
Working Papers
Risk Aversion at the Country Level
Nestor Gandelman
Ruben Hernandez-Murillo
Abstract

In this paper we provide estimates of the coefficient of relative risk aversion for 80 countries using data on self-reports of personal well-being from the Gallup World Poll. For most countries we cannot reject the null hypothesis that the coefficient of relative risk aversion equals 1. We conclude that our result supports the use of the log utility function in numerical simulations.


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Nestor Gandelman & Ruben Hernandez-Murillo, Risk Aversion at the Country Level, Federal Reserve Bank of St. Louis, Working Papers 2014-5, 01 Feb 2014.
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