Sharing or gambling? On risk attitudes in social contexts

This paper investigates experimentally whether risk attitudes are
stable across social contexts. In particular, it focuses on
situations where some resource (for instance, a position, decision
power, a bonus) has to be allocated between two parties: the
decision maker can either opt for sharing the resource or for using
a random device that allocates the entire prize to one of the two
parties. By varying the relative situation of the decision maker
with respect to the other party, we show that risk attitude is
strongly affected by social contexts: participants in the
experiment seem to be relatively risk seeking when they possess a
relatively weaker position than the other party and risk averse
when the opposite is true. Our main average results seem to be
driven by the behavior of around a quarter of subjects whose
choices appear to be fully determined by social comparisons.
Various interpretations of the behavior are provided linking our
results to preferences under risk with a social reference point and
on status-seeking preferences.