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Histograms by country, gender, and project risk level

Histograms by country, gender, and project risk level

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Article
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Access to credit is key to succeed in business. Theoretical models of credit under asymmetric information classify borrowers and grant or deny credit, typically based on incentive-compatible contracts with collateral. However, if women are particularly risk averse, female borrowers may be wrongly classified and denied credit. We conduct in three co...

Citations

... However, strong gender differences have been found in a downside risk environment involving loans for projects with specified failure probabilities that would trigger a payment of the collateral amount. Comeig et al. (2022) report significant gender differences in an experiment where borrowers (men and women) with a 90% probability of repaying the loan had to choose between (a) low interest payments and high collateral (only paid in case of no loan repayment) or (b) high interest rate and low collateral. Women tended to avoid the high collateral, while men did not, even knowing that the probability of transferring the required collateral was only 10%. ...
Article
Risky choices often involve a tradeoff between expected payoff and payoff variability. Subjects in a simple experiment, however, exhibit more aversion to “downside risk” (with a small probability of a low payoff) and more attraction to “upside risk” (with a small probability of a high payoff). Women tend to be more averse than men for downside risk, but not for upside risk. These patterns are evaluated in terms of the utility curvature and probability weighting components of risk preferences. Gender differences in downside risk are relevant for the design of appropriately gender-tailored policies and algorithms for saving, financing, and entrepreneurship.