The Geneva Risk and Insurance Review

, Volume 44, Issue 1, pp 27–53 | Cite as

The impact of economic conditions on individual and managerial risk taking

  • Mark Browne
  • Verena Jaeger
  • Petra SteinorthEmail author
Original Article


The current study examines how the financial crisis of 2008–2009 impacted individuals’ willingness to take risks (WTR). We find substantial changes in the WTR associated with the financial crisis which supports countercyclical risk aversion while controlling for wealth effects and risk perception. Yet, we also observe a quick recovery of the WTR immediately after the crisis. We find that managers are less risk averse in general, but participated less in the pre-crisis upswing in the WTR. Post-crisis, the managerial WTR took a deeper hit compared to the overall population. Changes in risk tolerance levels also differ across income levels, which we attribute to greater exposure to the stock market depreciation during the crisis.


Risk preferences Countercyclical risk aversion Managerial decision making Financial crisis 

JEL Classification

D81 G01 G32 J11 


Compliance with ethical standards

Conflict of interest

The authors declare that they have no conflict of interest.

Supplementary material

10713_2018_37_MOESM1_ESM.docx (65 kb)
Supplementary material 1 (DOCX 64 kb)


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Copyright information

© International Association for the Study of Insurance Economics 2019

Authors and Affiliations

  1. 1.School of Risk Management, Insurance and Actuarial ScienceSt. John’s UniversityNew YorkUSA
  2. 2.Munich School of Management, Munich Risk and Insurance CenterLudwig-Maximilians-UniversitätMunichGermany
  3. 3.Hamburg Business School, Institute for Risk Management and InsuranceUniversität HamburgHamburgGermany

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