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Risk Aversion: Experimental Evidence from South African Fishing Communities

We estimate the risk attitudes of a large sample of small-scale fishers from various fishing communities along the west coast of South Africa, using subjects’ choices over lotteries with real monetary prizes. We find that participants are moderately risk averse and that risk attitudes vary with certain socio-demographic variables. In particular, females are found to be more risk averse than their male counterparts, while quota holders are more risk loving. Logistic regression analysis indicates that risk attitudes have implications for non-compliance with fisheries regulation. Specifically, greater risk aversion translates into a reduction in the odds of catching illegally. Furthermore, in the case of gender, female fishers and female fishers with fishing rights are more likely to comply with fisheries regulation. These findings have important implications for the characterisation of risk attitudes in fisheries policy applications and for the management of marine resources.

Working Paper 227
22 July 2011
RELATED JOURNAL:

2012, American Journal of Agricultural Economics
22 July 2022
SHARE THIS Working Paper PUBLICATION:
25 September 2012
Publication Type: Working Paper
JEL Code: D81, Q22

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