Hartley, Roger, 1946-, Lanot, Gauthier and Walker, Ian, 1954- (2006) Who really wants to be a millionaire? Estimates of risk aversion from gameshow data. Working Paper. University of Warwick, Department of Economics, Coventry.

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Abstract

This paper analyses the behaviour of contestants in one of the most popular TV gameshows ever to estimate risk aversion. This gameshow has a number of features that makes it well suited for our analysis: the format is extremely straightforward, it involves no strategic decision-making, we have a large number of observations, and the prizes are cash and paid immediately, and cover a large range – from £100 up to £1 million. Our data sources have the virtue that we are able to check the representativeness of the gameshow participants. Even though the CRRA model is extremely restrictive we find that a coefficient or relative risk aversion which is close to unity fits the data across a wide range of wealth remarkably well.

Item Type:	Working or Discussion Paper (Working Paper)
Subjects:	H Social Sciences > HB Economic Theory H Social Sciences > HD Industries. Land use. Labor > HD61 Risk Management
Library of Congress Subject Headings (LCSH):	Who wants to be a millionaire, Game theory, Risk assessment, Choice (Psychology), Rational choice theory
Series Name:	Warwick economic research papers
Publisher:	University of Warwick, Department of Economics
Place of Publication:	Coventry
Date:	21 April 2006
Number:	No.747
Number of Pages:	54
Status:	Not Peer Reviewed
Access rights to Published version:	Open Access
Description:	Revised version
Funder:	Economic and Social Research Council (Great Britain) (ESRC)
Grant number:	R000239740 (ESRC)
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URI:	http://wrap.warwick.ac.uk/id/eprint/1448

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