The evolution of risk attitudes with fertility thresholds

• 成果类型: Article
• 署名作者: Robson, Arthur; Samuelson, Larry
• 署名单位: Simon Fraser University; Yale University
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2022.105552
• 发表日期: 2022
• 关键词: evolution; risk aversion; Aggregate risk; Age structured population

摘要

We examine the evolutionary selection of attitudes toward aggregate risk in an age structured population. Aggregate shocks perturb the population's consumption possibilities. Consumption is converted to fertility via a technology that exhibits first increasing and then decreasing returns to scale, captured in the simplest case by a fertility threshold. We show that evolution will select preferences that exhibit arbitrarily high aversion to aggregate risks with even very small probabilities of sufficiently low outcomes. These findings complement the familiar result that evolution will select for greater aversion to aggregate than idiosyncratic risks by identifying circumstances under which the difference can be extreme.(c) 2022 Elsevier Inc. All rights reserved.