Abstract

This paper studies the impact of different outcome correlation structures on gender differences in ambiguity aversion. We conducted an investment game with two separate treatments. In the uncorrelated treatment, the outcomes of the investment game were determined individually. In the correlated treatment, the outcomes of the investment game were determined collectively within a reference group. From an evolutionary perspective, men should be more concerned about relative outcomes, because their reproductive success mainly depended on their relative standing within society. Women, by contrast, should be more concerned about absolute outcomes, because their reproductive success was mainly linked to their access to resources for themselves and their children. Therefore, we predict that the type of outcome correlation structure has a larger impact on men than on women. In particular, we hypothesize that men are less ambiguity averse under an uncorrelated outcome structure. In this situation, the ambiguous alternative should be more attractive, because it potentially reduces inequality and thereby improves men’s relative standing within society. Women’s choices should not be significantly affected by different outcome correlation structures. Both hypotheses are supported by evidence from laboratory experiments.