How much risk can you stomach? Individual differences in the tolerance of perceived risk across gender and risk domain

Abstract

AbstractResearch within the psychological risk–return framework, namely, using the Domain‐Specific Risk‐Taking scale, has led to a conclusion that risk attitude—measured as an individual's sensitivity to the risk they perceive—is stable across people (e.g., gender) and domains (e.g., recreational, social, financial, & health). Risk taking differences across gender and domain have been interpreted in terms of differences in the magnitude of risk perceived (and expected benefit). Yet the Domain‐Specific Risk‐Taking scale items, contrived by researchers rather than decision makers themselves, may have failed to detect differences in perceived risk attitude by failing to adequately represent all combinations of risks and benefits across gender and domains. In Study 1, participants generated their own examples of activities, which we selected among in Studies 2 and 3 to construct a new scale representing various levels of perceived risk and expected benefit. Our findings reveal that women are more sensitive than men to risk they perceive (i.e., are less tolerant of risk) in the recreational, social, and financial domains but not in the health domain. Risk attitude also differed across domains, with participants tolerating more risk in some domains than in others. We conclude that gender and domain differences in risk taking stem partly from gender and domain differences in people's sensitivity to perceived risks. Our findings have theoretical implications for the psychological risk–return framework and bridge with other theoretical approaches, such as the expected utility framework. Our studies also provide a new scale for assessing differences in attitudes toward risk that overcomes shortcomings of existing scales.