Impact of a Natural Disaster on Observed Risk Aversion
Attitudes toward risk play an important role in economic behavior, but how these attitudes change following large disruptive events remains unclear. This is largely due to persistent problems of selective exposure, mortality, and migration in these contexts. This study explores the impact of exposure to an unanticipated natural disaster, the 2004 Indian Ocean tsunami, on attitudes toward risk using exogenous variation in exposure for a sample representative of the pre-disaster population.