Journal of Finance and Economics

Journal of Finance and Economics

ISSN: 2291-4951 (Print)    ISSN: 2291-496X (Online)

Volume 4 (2016), No. 4, Pages 1-10

DOI: 10.12735/jfe.v4n4p01

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Individual Risk Preferences and Better Car Replacement

Fan Liu1 

1Department of Finance and Supply Chain Managment, John L. Grove College of Business, Shippensburg University, Pennsylvania, USA


To Cite this Article     Article Views: 1214     Downloads: 743  Since deposited on 2016-10-12


We conduct a survey to examine the impact of individual risk preferences on better car replacement decision in the insurance market. The survey consists of a lottery choice task and an insurance questionnaire. Our results strongly support contentions that consumers are significantly influenced by their risk attitudes and the insurance premium. Further, we find that female consumers are more influenced by their degree of risk aversion than male consumers when making such insurance decision. Moreover, our results show that when the level of risk aversion is controlled, the individual risk preferences have different magnitudes of impact on insurance decision making.

JEL Classifications: C91, G22

Keywords: better car replacement, individual risk preferences, insurance premium, purchasing decision, risk aversion, risk attitudes

To Cite this Article: Liu, F. (2016). Individual risk preferences and better car replacement. Journal of Finance and Economics, 4(4), 1-10.

Copyright © Fan Liu

Creative Commons License
This article is published under license to Science and Education Centre of North America. This is an Open Access article distributed under the terms of the Creative Commons Attribution 4.0 International License.

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Individual Risk Preferences and Better Car Replacement