Relative Wealth Placement and Risk-Taking Behavior
Last registered on July 01, 2019


Trial Information
General Information
Relative Wealth Placement and Risk-Taking Behavior
Initial registration date
April 10, 2019
Last updated
July 01, 2019 2:26 AM EDT
Primary Investigator
Universität Hamburg
Other Primary Investigator(s)
PI Affiliation
Universität Hamburg
Additional Trial Information
Start date
End date
Secondary IDs
This study investigates whether and, if so, to what extent relative wealth placement, i. e. an individual’s relative position in the wealth distribution, impact individuals’ risk-taking behavior. We first develop a stylized model where concerns about relative wealth enter utility and derive several hypotheses how placement in the wealth distribution affects risk-taking. Generally, we hypothesize that concerns about relative wealth placement specifically increase (decrease) risk-taking among the individuals placed at the bottom (top) of the wealth distribution. In addition, we derive reasonable conditions under which placement at the bottom (top) of the wealth distribution leads to more (less) risk-taking than being placed in the middle of the distribution, c.p. Further, we conduct an experimental study to disentangle relative wealth changes from absolute wealth changes.
External Link(s)
Registration Citation
Hillebrandt, Marc-Andre and Petra Steinorth. 2019. "Relative Wealth Placement and Risk-Taking Behavior." AEA RCT Registry. July 01.
Experimental Details
In a laboratory experiment, we study whether and, if so, to what extent relative wealth placement, i.e. an individual’s relative position in the wealth distribution, impact individuals’ risk-taking behavior using a mixed within- and between-subjects design
Intervention Start Date
Intervention End Date
Primary Outcomes
Primary Outcomes (end points)
Risk preferences from subjects with a low placement in the wealth distribution compared to subjects’ risk preferences with a high placement
Primary Outcomes (explanation)
Secondary Outcomes
Secondary Outcomes (end points)
Secondary Outcomes (explanation)
Experimental Design
Experimental Design
Our design encompasses two treatment groups, L and H, as well as a control group C. In the two main treatments L and H, subjects are divided into groups of three where individuals are randomly placed within the wealth distribution by receiving an endowment. In addition, they are informed about the endowments of their group members. Subjects in the control group C simply receive an endowment without being placed in a group or learning about the wealth distribution. Further, our experiment uses a mixed within- and between-subjects design, meaning that subjects are randomly assigned to one of the three treatments in the first place, but then go through the other two treatments in random order as well.

To elicit subjects’ risk preferences, we follow the elicitation method of Gneezy and Potters (1997). Our experiment is designed in such a way as to examine how subjects’ risk preferences change after experiencing wealth changes only at the relative level: some individuals receive identical endowments in L and H, but the endowment of their group members is different, i.e. they place differently in the wealth distribution. Subjects receive information about the wealth levels of the other group members and are explicitly informed whether they have the lowest, median or highest wealth endowment in their group. Under L and H, subjects are informed that all subjects within their group have been equipped with a different initial endowment, whereby this allocation took place randomly and the possible endowments were:
• L = {2,150 coins; 3,450 coins; 4,050 coins},
• H = {3,450 coins; 4,050 coins; 7,150 coins}.

With this setup, those subjects that receive 3,450 Taler or 4,050 Taler are endowed with the same absolute wealth compared to those in the other treatment, but experience a variation in relative wealth placement. Under treatment L, subjects have a higher wealth placement compared to treatment H; yet, absolute wealth levels are the same. Accordingly, this allows us to evaluate how variations only in relative wealth – holding the absolute wealth level constant – impact individuals’ risk-taking behavior.

Subjects in the control treatment C only receive an initial endowment of either 3,450 Taler or 4,050 Taler without any further information about their placement in the relative wealth distribution (or other participants).
Experimental Design Details
Randomization Method
All subjects will be recruited using hroot (Bock, Baetge, and Nicklisch, 2014). Further randomization will be done by oTree software
Randomization Unit
Session (order of treatments shown to subjects depends on the experimental session they signed up for), and individual (subjects are randomly allocated to the different wealth levels)
Was the treatment clustered?
Experiment Characteristics
Sample size: planned number of clusters
18 experimental sessions
Sample size: planned number of observations
432 subjects
Sample size (or number of clusters) by treatment arms
144 subjects beginning with treatment L, H, and C respectively
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
IRB Name
IRB Approval Date
IRB Approval Number
Post Trial Information
Study Withdrawal
Is the intervention completed?
Intervention Completion Date
June 19, 2019, 12:00 AM +00:00
Is data collection complete?
Data Collection Completion Date
June 19, 2019, 12:00 AM +00:00
Final Sample Size: Number of Clusters (Unit of Randomization)
19 experimental sessions
Was attrition correlated with treatment status?
Final Sample Size: Total Number of Observations
420 subjects
Final Sample Size (or Number of Clusters) by Treatment Arms
153 subjects beginning with treatment L and H, and 114 subjects beginning with C
Data Publication
Data Publication
Is public data available?
Program Files
Program Files
Reports and Papers
Preliminary Reports
Relevant Papers