Scandinavian Working Papers in Economics

Working Paper Series,
Uppsala University, Department of Economics

No 2018:6: Sibling Correlation in Risk Attitudes: Evidence from Burkina Faso

Mohammad H. Sepahvand () and Roujman Shahbazian ()
Additional contact information
Mohammad H. Sepahvand: Department of Economics
Roujman Shahbazian: Swedish Institute for Social Research, Stockholm University, Postal: Stockholm University, 106 91 Stockholm, Sweden

Abstract: This study uses sibling correlation to investigate the importance of parental and household characteristics on three different risk domains collected in a nationally representative survey from Burkina Faso. Sibling correlations are between 0.51 and 0.83. The correlations are higher in the general risk domain compared to risk taking in financial matters and traffic. Moreover, the sibling correlation is higher for the younger generation of siblings than the older generation, and for sisters than brothers. We also explore which factors drive these correlations; parents’ risk attitudes help explain these correlations, whereas socioeconomic outcomes, family structure, parental health and residential zone have only a limited contribution. We also find that gender is important in explaining the variation in sibling correlations. Mother’s have a stronger contribution on daughter’s correlation than fathers, whereas fathers help to explain the son’s correlation to a larger extent.

Keywords: risk attitudes; family background; sibling correlations; Burkina Faso

JEL-codes: D10; D81; J60; Z10

36 pages, March 1, 2018

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