Social class & risk preferences and behavior

This paper reviews recent work regarding the link between one's societal ranking (or social class), and risk preferences and behavior. While the topic of social class and its relationship to risk has been studied only tentatively in psychology, preliminary evidence suggests that experiences with rank, access to resources, and movement between classes have a meaningful impact on people's risk preferences and behaviors. Yet, a clear pattern of results remains elusive. Some studies suggest that lower social class standing is related to risk aversion, while others suggest it is related to risk taking. These mixed results highlight the need for future research that examines when and why lower social class standing is related to more or less risky decisions. By shedding light on this important phenomenon, the hope is to offer intervention opportunities that influence policies and mitigate inequality.