Inequality and Risk-Taking Behaviour

This paper investigates social influences on attitudes to risk and offers an evolutionary explanation of risk-taking by young low-ranked males. Becker, Murphy and Werning (2005) found that individuals about to participate in a status tournament may take fair gambles even though they are risk averse in both wealth and status. Here their model is generalised by use of the insight of Hopkins and Kornienko (2010) that in a tournament or status competition one can consider equality in terms of the status or rewards available as well as in initial endowments. While Becker et al. found that risk-taking is increasing in the equality of initial endowments, it is found here that it is increasing in the inequality of rewards in the tournament. Further, it is shown that the poorest will be risk loving if the lowest level of status awarded is sufficiently low. Thus, the disadvantaged in society rationally engage in risky behavior when social rewards are sufficiently unequal. Finally, as greater inequality in terms of social status induces gambling, it can cause greater inequality of wealth.

The Relationship Between Youth Risk-Taking Behaviour and Activity Engagement

Youth have been found to engage in various risk-taking behaviours at higher rates than any other age group. However, there is a lack of research on the division between adaptive and maladaptive risk behaviours among adolescents and emerging adults. Adaptive risk-taking behaviours may present youth with ways to successfully partake in the risk behaviours that they are naturally inclined to engage in. The relationship between activity engagement and positive youth development has been extensively studied and cited as a way to expose youth to positive experiences and promote successful development. However, the relationship between activity engagement and risk behaviours among youth has yetto be studied in depth. This study investigated the potential relationship between various adaptive and maladaptive risk behaviours and activity engagement among youth, through an indirect link through five mediator variables. These potential mediators represented the three systems in Jessor's Problem Behaviour Theory. Participants included 276 youth (M = 19.06 years, SD = 1.60, 89.1 % female) from Brock University. Results revealed that activity engagement significantly predicted greater adaptive social risk behaviours among youth. However, there was no mediating effect through the problem behaviour systems. Correlations revealed that being male was associated with more maladaptive risk behaviours and fewer adaptive risk behaviours than females. Additionally, behavioural engagement specifically related to less maladaptive physical health risks and psychological engagement related to greater adaptive social risks. Overall, these findings suggest that activity engagement may be differentially related to the various types of risk-taking and gender associations may exist between the various types and dimensions of risk behaviours, but future work is needed to understand the variables that may explain such relationships.

Association between neighbourhood socioeconomic characteristics and high-risk injection behaviour amongst injection drug users living in inner vs. other city areas in Montréal, Canada

Ce manuscrit est une pré-publication d'un article paru dans International Journal of Drug Policy 2010; 21(1): 49-55.

Injury related risk behavior - a study of Australian skydivers

Risk taking behaviour has been identified as an important host-related determinant of injury in young adults. The aim of this study is to clarify the relationship between the two key elements of risk taking behaviour - ie, risk assessment and risk acceptance - in participants of a high risk sporting activity. Skydivers registered with the Australian Parachute Federation were sampled at several jump meetings held at three 'drop-zones' in North Eastern Australia. A cross sectional survey of 215 skydivers ascertained each subject's risk assessment of each of nine hypothetical sky diving scenes and whether or not they would jump in the described conditions. Variables which independently predicted an individual's risk assessment were age group (p < 0.05), gender (p < 0.05) and scene details (p < 0.001). Risk assessment was found to be a statistically significant predictor of the decision to jump, with a 22% decrease in the odds of jumping with every unit increase in risk assessment (OR = 0.78: 95% Cl; 0.76, 0.80). Gender was also found to be a statistically significant predictor of the decision to jump, with males being 19% more likely to jump than females, after controlling for age, experience, currency and risk assessment (OR = 1.19: 95% CI; 1.04, 1.38). The importance of these results is that, by quantifying the relationship between two key elements of risk taking behaviour and several important host factor determinants, they facilitate more informed discussion about the possible role of risk taking behaviour in the causation of injury.

On the Relationship between Market Power and Bank Risk Taking

We analyse risk-taking behaviour of banks in the context of spatial competition. Banks mobilise unsecured deposits by offering deposit rates, which they invest either in a prudent or a gambling asset. Limited liability along with high return of a successful gamble induce moral hazard at the bank level. We show that when the market power is low, banks invest in the gambling asset. On the other hand, for sufficiently high levels of market power, all banks choose the prudent asset to invest in. We further show that a merger of two neighboring banks increases the likelihood of prudent behaviour. Finally, introduction of a deposit insurance scheme exacerbates banks’ moral hazard problem.

Trends in drug consumption and risk of transmission of HIV and hepatitis C virus among injecting drug users in Switzerland, 1993-2006

As a part of the HIV behavioural surveillance system in Switzerland, repeated cross-sectional surveys were conducted in 1993, 1994, 1996, 2000 and 2006 among attenders of all low threshold facilities (LTFs) with needle exchange programmes and/or supervised drug consumption rooms for injection or inhalation in Switzerland. Data were collected in each LTF over five consecutive days, using a questionnaire that was partly completed by an interviewer and partly self administered. The questionnaire was structured around three topics: socio-demographic characteristics, drug consumption, health and risk/preventive behaviour. Analysis was restricted to attenders who had injected drugs during their lifetime (IDUs). Between 1993 and 2006, the median age of IDUs rose by 10 years. IDUs are severely marginalised and their social situation has improved little. The borrowing of used injection equipment (syringe or needle already used by other person) in the last six months decreased (16.5% in 1993, 8.9% in 2006) but stayed stable at around 10% over the past three surveys. Other risk behaviour, such as sharing spoons, cotton or water, was reported more frequently, although also showed a decreasing trend. The reported prevalence of HIV remained fairly stable at around 10% between 1993 and 2006; reported levels of hepatitis C virus (HCV) prevalence were high (56.4% in 2006). In conclusion, the overall decrease in the practice of injection has reduced the potential for transmission of infections. However as HCV prevalence is high this is of particular concern, as the current behaviour of IDUs indicates a potential for further spreading of the infection. Another noteworthy trend is the significant decrease in condom use in the case of paid sex.

Ownership structure and risk at Colombian banks

The separation between ownership and the control of capital in banks generates differences in the preferences for risk among shareholders and the manager. These differences could imply a corporate governance problem in banks with a dispersed ownership, since owners fail to exert control in the allocation of capital. In this paper we examine the relationship between the ownership structure and risk for Colombian banks. Our results suggest that a high ownership concentration leads to higher levels of risk.

Paying for long-term performance: restructuring bankers’ pay for risk regulation

The purpose of this paper is to propose hybrid capital securities as a new approach to compensation for senior bank executives and risk-takers instead of cash or equity-based compensation currently adopted by the industry. The global financial turmoil indicated that misaligned pay-for-performance compensation arrangements encouraged management short-termism and rewarded excessive risk-taking behaviour in Anglo-Saxon system. Rather than regulating specific instruments and processes, we believe that it is much more efficient to overhaul the compensation scheme to align it with risk management and governance. This empirical paper investigates the European hybrid market by employing data from the Merrill Lynch Global Index System from 2000 to 2010. Our paper contributes to both literature and practices by designing a structured scheme to tie the executive’s interests to long-term performance of the bank, the goal of regulators and the economy at large which consequently reduce the probability of future bank failures.

Risk-taking and inhibitory control in behaviourally inhibited and disinhibited preschool children

The temperament style Behavioural Inhibition (BI) has been implicated as a risk factor for the development of internalising disorders such as anxiety. Of interest is what factors influence the developmental trajectories of both inhibited and disinhibited children and the development of psychopathology. One such factor is risk-taking behaviour. Using the computer based Balloon Analogue Risk Task, we assessed risk taking behaviour in behaviourally inhibited (n = 27) and behaviourally disinhibited (n = 43) children. This is the first study to examine the relationship between BI, executive functioning and risk-taking. The results indicated Behavioural Inhibition was not related to risk-taking but that inhibitory control predicted reward focused results. These findings illustrate how inhibitory control affects risk-taking and risk avoidance in both inhibited and disinhibited children.

Health-protective behaviours and risk of fall-related hip fractures: a population-based case-control study

Background: fall-related hip fractures are one of the most common causes of disability and mortality in older age. The study aimed to quantify the relationship between lifestyle behaviours and the risk of fall-related hip fracture in community-dwelling older people. The purpose was to contribute evidence for the promotion of healthy ageing as a population-based intervention for falls injury prevention. Methods: a case-control study was conducted with 387 participants, with a case-control ratio of 1:2. Incident cases of fall-related hip fracture in people aged 65 and over were recruited from six hospital sites in Brisbane, Australia, in 2003-04. Community-based controls, matched by age, sex and postcode, were recruited via electoral roll sampling. A questionnaire designed to assess lifestyle risk factors, identified as determinants of healthy ageing, was administered at face-to-face interviews. Results: behavioural factors which had a significant independent protective effect on the risk of hip fracture included never smoking [adjusted odds ratio (AOR): 0.33 (0.12-0.88)], moderate alcohol consumption in mid- and older age [AOR: 0.49 (0.25-0.95)], not losing weight between mid- and older age [AOR: 0.36 (0.20-0.65)], playing sport in older age [AOR: 0.49 (0.29-0.83)] and practising a greater number of preventive medical care [AOR: 0.54 (0.32-0.94)] and self-health behaviours [AOR: 0.56 (0.33-0.94)]. Conclusion: with universal exposures, clear associations and modifiable behavioural factors, this study has contributed evidence to reduce the major public health burden of fall-related hip fractures using readily implemented population-based healthy ageing strategies.

Psychosocial risk factors for pregnancy risk-taking in young women in emerging adulthood: Evidence from the Australian Longitudinal Study on Women's Health

This study represents the first longitudinal investigation of distal psychosocial predictors of pregnancy risk-taking in young Australian women. Participants were from the Australian Longitudinal Study on Women's Health. Two mail-out surveys assessing sociodemographic, education/competence, psychosocial wellbeing, and aspiration/identity factors, were completed at ages 18 and 22 by 1647 young women in emerging adulthood, and a third survey assessing pregnancy risk-taking behaviour was completed by a subsample of 90 young women at age 24. Higher psychosocial distress at age 22 was a risk factor for pregnancy risk-taking at age 24 (beta=0.29-0.38). Post hoc analyses suggested that the strongest component of psychosocial distress when predicting pregnancy risk-taking was higher depressive symptoms (beta=0.44-0.68). Demographic, education, unemployment, and future aspirations factors at age 18 and 22 were unrelated to pregnancy risk-taking at age 24.

Risk homeostasis theory in simulated environments

This thesis has two aims. First, it sets out to develop an alternative methodology for the investigation of risk homeostasis theory (RHT). It is argued that the current methodologies of the pseudo-experimental design and post hoc analysis of road-traffic accident data both have their limitations, and that the newer 'game' type simulation exercises are also, but for different reasons, incapable of testing RHT predictions. The alternative methodology described here is based on the simulation of physical risk with intrinsic reward rather than a 'points pay-off'. The second aim of the thesis is to examine a number of predictions made by RHT through the use of this alternative methodology. Since the pseudo-experimental design and post hoc analysis of road-traffic data are both ill-suited to the investigation of that part of RHT which deals with the role of utility in determining risk-taking behaviour in response to a change in environmental risk, and since the concept of utility is critical to RHT, the methodology reported here is applied to the specific investigation of utility. Attention too is given to the question of which behavioural pathways carry the homeostasis effect, and whether those pathways are 'local' to the nature of the change in environmental risk. It is suggested that investigating RHT through this new methodology holds a number of advantages and should be developed further in an attempt to answer the RHT question. It is suggested too that the methodology allows RHT to be seen in a psychological context, rather than the statistical context that has so far characterised its investigation. The experimental findings reported here are in support of hypotheses derived from RHT and would therefore seem to argue for the importance of the individual and collective target level of risk, as opposed to the level of environmental risk, as the major determinant of accident loss.

Transitions between routes of benzodiazepine administration among heroin users in Sydney

A sample of 312 heroin users were interviewed regarding their benzodiazepine use. The majority (94%) had used benzodiazepines, 72% in the 6 months prior to interview. Benzodiazepine injecting was common, with 28% of the sample having injected these drugs, 13% in the 6 months preceding interview. Current benzodiazepine injectors showed greater polydrug use, injection-related HIV risk-taking behaviour, criminal involvement, psychological distress and injection-related health problems, as well as poorer general health, and an increased risk of having overdosed than other users of benzodiazepines. Of those subjects who had injected benzodiazepines, 55% were no longer current benzodiazepine injectors. Concern for general health emerged as the most common reason for having made a transition away from injecting, and for being likely to make such a transition.