Individuals’ risk propensity and job search activity

Abstract: This paper uses the Dutch panel data from LISS, Longitudinal Internet Studies for the Social Science in trying to establish if a relationship between individuals’ risk propensity and job search activity is present. When looking at employed and unemployed job seekers jointly, a positive significant relationship is present. Looking at these groups separately shows that the relationship is driven by employed job seekers. No relationship for unemployed job seekers can be identified when being looked at separate. However, when taking into account possible biases from changes in risk propensity over time as well as the classification of actively searching individuals, no relationship is present at all. We hence are cautious towards the significant estimates received that potentially could suffer from biases. Further studies should be made with a bigger sample of individuals and a continuously updated measure of risk propensity to minimizing potential bias.