Discount Rates in Risk v. Money and Money v. Money Tradeoffs

Arbeitspapier

We use data from a survey of residents of five Italian cities conducted in late Spring 2004 to estimate the discount rates implicit in (a) money v. future risk reductions and (b) money v. money tradeoffs. We find that the mean personal discount rate is 2% in (a) and 8.7% in (b). The latter is lower than the discount rates estimated in comparable situations in many recent studies, greater than market interest rates in Italy at the time, and exhibits modest variation with age and gender. The discount rate implicit in money v. risk tradeoffs is in line with estimates from studies in the US and Europe, and does not depend on observable individual characteristics.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Nota di Lavoro ; No. 8.2006

Classification and Topics

• Classification: Wirtschaft ; Value of Life; Forgone Income ; Health: Government Policy; Regulation; Public Health ; Micro-Based Behavioral Economics: Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making‡
• Subject: Value of a statistical life ; Latent risk reductions ; Individual discount rates ; Stated preference questions ; Menschen ; Bewertung ; Abzinsung ; Risiko ; Italien ; Wert des Lebens

Contributors, Location and Time

• Event: Geistige Schöpfung
• (who): Alberini, Anna ; Chiabai, Aline
• Event: Veröffentlichung
• (who): Fondazione Eni Enrico Mattei (FEEM)
• (where): Milano
• (when): 2006

Further information

• Handle: http://hdl.handle.net/10419/74131
• Last update: 10.03.2025, 11:44 AM CET