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Does higher perceived risk of morbidity and mortality decrease risk-taking?

Mélusine Boon-Falleur1, Brigitte Dormont2, Coralie Chevallier1

  • 1LNC², Département d'études cognitives, Ecole normale supérieure, Université PSL, INSERM, 75005 Paris, France.

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Summary
This summary is machine-generated.

People adapt their behavior to negative health shocks like COVID-19. Higher perceived risk of illness or death increases risk aversion and reduces patience, influencing decision-making.

Keywords:
COVID-19patienceperceived riskrisk-takingstructural model

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Area of Science:

  • Behavioral Economics
  • Public Health
  • Psychology

Background:

  • Behavioral responses to negative shocks are documented.
  • Optimal behavior is influenced by environmental mortality risk.
  • The COVID-19 pandemic significantly altered daily life and perceived risks.

Purpose of the Study:

  • Investigate how individuals perceive morbidity and mortality risks from COVID-19.
  • Examine the impact of perceived risk on psychological traits like risk-taking and patience.
  • Understand behavioral adaptations to health threats.

Main Methods:

  • Analysis of a large survey (n=3353) during the first COVID-19 wave in France.
  • Utilized a structural model to address endogeneity concerns.
  • Assessed perception of morbidity and mortality risk based on local public information.

Main Results:

  • Individuals use local COVID-19 death data to estimate personal risk.
  • Increased perceived morbidity and mortality risk significantly raises risk aversion.
  • Higher perceived risk correlates with decreased patience, particularly at elevated risk levels.

Conclusions:

  • People adjust their behavior in anticipation of negative health shocks.
  • Perceived COVID-19 risks influence psychological traits related to decision-making.
  • Behavioral adaptations are a response to the threat of illness or death.