RESEARCH ARTICLE. GENDER DIFFERENCES IN RISK TAKING: EVIDENCE FROM A MANAGEMENT INSTITUTE Amit Kapoor 1

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1 GENDER DIFFERENCES IN RISK TAKING: EVIDENCE FROM A MANAGEMENT INSTITUTE Amit Kapoor 1 HOW TO CITE THIS ARTICLE: Amit Kapoor. Gender differences in Risk Taking: Evidence from a Management Institute. Journal of Advances in Business Management; Vol. 1, Issue 1, April 2015; Page: 1-5. ABSTRACT: This study aims to find out risk attitude of the students of Centre for Management Studies, Jamia Millia Islamia, Delhi, so as to provide assistance to the top management and academic coordinators, in designing academic policies accordingly. It also tries to find out if gender differences occur in risk taking. To fulfill these objectives, 138 participants were given a questionnaire to assess their likelihood to be engaged in risk taking behavior in five domains (Health, ethical, recreational, financial and social). Data thus collected was analyzed using various statistical tools. Result suggested that men are more likely to be engaged in risk taking behavior in ethical, health and safety domain while there are no significant gender differences across social and recreational domain. KEYWORDS: Gender differences, Risk attitude, Risk taking. INTRODUCTION: Various reports have suggested that there are few women in top management. Is it associated with gender differences in risk taking, as business is all about taking risks and maximizing profit? Similarly, as per various government reports men are more involved in accidental deaths. Are men more likely to be engaged in taking health risk? Let s find the answer. Risk can be defined as "the appraised likelihood of a negative outcome for behavior" (Zuckerman, 1994, p. 124). Risk-taking Attitude refers to the tendency, to be engaged in behavior that is potentially harmful or dangerous, yet at the same time provides the opportunity for some kind of outcome that can be perceived as positive. Risk taking Behaviors are "volitional, purposive, goal-oriented and carry potential for harm" (Lightfoot, 1997, p. 22). Taking risk is part of life. It is most definitely part of growing up. If we don t take risks we never learn about our own capabilities or discover the joy of new experiences. According to Robbins et al. (2009), [1] People differ in their willingness to take chances. This propensity to assume or avoid risk has been shown to have an impact on how long it takes managers to make a decision and how much information they require before making a choice. High risk-taking managers made more rapid decisions and used less information in making their choices than did the low risk-taking managers. Risk can be good, but they can also be unhealthy. Healthy risk-taking is a valuable experience. Healthy risks that are good to encourage in teens include sporting activities, artistic & creative abilities (theatre, dance, music), volunteer activities, traveling, making new friends, or entering competitions (academic or athletic). Unhealthy risk-taking behavior includes driving too fast, texting or talking on the phone while driving, unprotected sex, smoking, excessive alcohol consumption, stealing, gang activity, or disordered eating. Types of Risk Attitude: A person is said to be risk averse if he prefers less risk to more risk, all else being equal. The opposite of risk aversion is risk seeking (Sometimes called risk loving). Journal of Advances in Business Management / Volume 1/ Issue 1/ April 2015 Page 1

2 A risk seeking person prefers more risk to less, all else being equal. Between risk aversion and risk seeking is a state called risk neutrality. A person is risk neutral if he is indifferent to risk. He will neither pay to avoid it nor to take it. In a nutshell, risk does not affect his decisions. Review of Literature: Gender differences in risk taking, has been well documented in various studies. Byrnes et.al (1999), [2] conducted a meta-analysis of 150 studies in which gender differences of risk taking was analyzed. Result showed that there are gender differences in risk taking propensity. In some topics (e.g. intellectual risk, physical risk) difference was higher than other (e.g. smoking). Robert et.al (1988) [3] showed that there occur gender differences in risk taking propensity in women and men entrepreneur. Hirschberger et al. (2001) [4] conducted and compared two studies that he conducted on American students and Israeli students. Results showed that in both countries women were less likely to be engaged in risky behavior. Cardenas et al. (2011) [5] explored gender differences in risk taking and competitiveness among 9 to 12 years age students of Colombia and Sweden. Result showed boys in both countries are more risk taking than girls, with a smaller gender gap in Sweden. US Centre for Disease Control (CDC), (2004) report has shown that men are more often victim of road accidents than women. For every 100, 000 US drivers, men are three times as likely as women to be involved in fatal car accidents (U.S. Department of Transportation, 2004). Weber, Blais, and Betz (2002) [6] in there domain specific research assessment showed that degree of risk taking was highly domain-specific, and women appeared to be more risk-averse in all domains except social risk. Pawlosky et al. (2008). [7] Showed through their study those males are more likely to cross roads when it is risky to cross. Dwyer, Gilkeson and List (2002) [8] analyzed data of 2000 mutual investors and found that females are more risk averse than males. To conclude, most researches have shown that there are gender differences in risk taking. OBJECTIVE OF THE STUDY: This study tries to find out if gender differences occur in risk taking. More specifically, this study has following objectives: I. To explore risk attitude of students of Centre for Management Studies, Jamia Millia Islamia, Delhi. II. To find gender differences, if any, exists in risk taking in various domains. HYPOTHESES: Hypothesis 1: H 0: there are no gender differences in ethical risk taking. H 1: there is difference between genders in ethical risk taking. Hypothesis 2: H 0: there are no gender differences in financial risk taking. H 1: there is difference between genders in financial risk taking. Hypothesis 3: H 0: there are no gender differences in recreational risk taking. H 1: there is difference between genders in recreational risk taking. Hypothesis 4: H 0: there are no gender differences in health risk taking. H 1: there is difference between genders in health risk taking. Hypothesis 5: H 0: there are no gender differences in social risk taking. H 1: there is difference between genders in social risk taking. Journal of Advances in Business Management / Volume 1/ Issue 1/ April 2015 Page 2

3 RESEARCH METHODOLOGY: Data Source: Primary data was collected from 138 participants of Centre for Management Studies, Jamia Millia Islamia, Delhi, through structured questionnaire and informal interview. Research Instrument: For the purpose of data collection, a structured questionnaire was designed. Questionnaire consisted of two parts; first part was dedicated to demographic questions while second part consisted of domain specific risk questions. For this, 20 questions in five domains (4 in each domain i.e. ethical, financial, recreational, social, and health & safety) from DOSPERT scale designed by Weber et al. (2006), were adopted. Respondents were to respond on 7 points scale for each likert item. Data Analysis: Data so collected was tabulated and analyzed in such a way so as to make interpretations. Various steps, which were required to fulfill the purpose, i.e., classifying, coding, and tabulating were taken. Respondents score for each item in specific domain were summed up and analyzed. To summarize the sample data descriptive statistics (such as frequency distribution and mean) were used. To analyze gender differences in risk taking, t-test for independent sample by SPSS v. 16 was used. RESULT: Distribution of sample as per demographic variables is shown in Table- 1 Variable Category Frequency % age Age years years 31years - above % % 5.79 % Gender Male Female % % Marital Status Unmarried Married % 7.93 % Work Experience Nil 0-2 years 2-5 years 5 years - above Table 1: Distribution of demographic characteristics % % % % Table-1 shows that male constitute % of the sample followed by females (40.58%). Most of the respondents (92.03 %) are unmarried. Most of the respondents have no work experience (52.17 %) followed by less than 2 year work experience (21.74 %). Journal of Advances in Business Management / Volume 1/ Issue 1/ April 2015 Page 3

4 Descriptive statistics for the risk taking in different domain is shown in Table-2. N Ethical Finance Recreational Health Social Valid Missing Mean Median Mode 9.00 a a Std. Deviation a. Multiple modes exist. The smallest value is shown Table 2: Descriptive statistics for different domain Mean score for ethical domain and health risk domain is and respectively while for finance, recreational and social domain, it is 16.49, 16.87, and respectively. Overall mean responses for each domain by gender are shown in Table-3. T-tests for independent sample were also performed on each domain and are shown in Table-3. Risk Domain Male Female T- test Analysis Ethical (4.13) (4.49) t=2.359, p=0.020 Finance (4.46) (4.17) t=0.661, p=0.510 Recreational (5.63) (6.77) t=-0.139, p=0.890 Health (5.76) (4.93) t=2.378, p=0.019 Social (4.18) (4.31) t=0.593, p=0.554 Table 3: Means (SD) of gender differences in risk taking by domain Table-3 shows that mean score of male respondents in all domains except recreational domain is higher than female respondents. Further, t-test shows there is significant gender differences in ethical and health risk domain as p-value < Results from Table-3 suggest to reject null hypothesis (H 0) of hypothesis-1 (p=0.020) and hypothesis-4 (p<0.019) and to accept null hypothesis (H 0) of hypothesis-2 (p=0.510), hypothesis-3 (p=0.890) and hypothesis-5 (p=0.554). CONCLUSION AND DISCUSSION: This study tried to explore risk taking attitude of students of Centre for Management Studies, Jamia Millia Islamia, and Delhi. It also tried to find out if gender differences occur in risk taking. Results showed that there occur gender differences in risk taking. There are strong evidences of gender differences in ethical risk taking and health risk taking. Results showed that males are more inclined towards taking health risk. The current study also reaffirms what has been proved through previous studies, though in context of a specific institute. As this study was limited to the students of Centre for Management Studies, Jamia Millia Islamia, New Delhi, only, I would like to suggest that such study should be conducted on a large scope so that results can be generalized. Journal of Advances in Business Management / Volume 1/ Issue 1/ April 2015 Page 4

5 Further, I also hope this study would be beneficial for the administration of the institute to formulate academic policies and training programme for the students, accordingly. Limitation of the Study: I. This study was focused to a single institute, so sample size was not very large. II. Lack of time and other resources were constraints to conduct study at large scope. III. Unwillingness and biasness of respondents were other limitation in the study. REFERENCES: 1. Robbins SP, Judge TA, Sanghi S, Organizational behaviour. 13 th edition, Pearson Education, Inc. p.123, Byrnes et al., Gender differences in risk taking: A meta-analysis, Psychological Bulletin, Vol.125, Issue no. 3, p , Robert et al. Sex Differences and Risk-Taking Propensity of Entrepreneurs, Journal of Small Business Management, Vol. 26, Issue no. 1, p , Hirschberger G. et al., Gender Differences in the willingness to engage in Risky Behavior: a Terror Management Perspective, Death Studies, Vol. 26, Issue no. 2, p , Cardenas et al., Gender differences in competitiveness and risk taking: comparing children in Colombia and Sweden, SSE/EFI Working Paper Series in Economics and Finance, Issue No. 730, Weber E. et al., A Domain-specific Risk-attitude Scale: Measuring Risk Perceptions and Risk Behaviors, Journal of Behavioral Decision Making, Vol. 15, Issue no. 4, p , Powlsky B. et al. Sex Differences in Everyday Risk-Taking Behavior in Humans, Evolutionary Psychology, Vol.6, Issue no. 1, p , Dwyer PD et al. Gender differences in revealed risk taking: evidence from mutual fund investors, Elsevier Economic Letters, Vol. 76, Issue no. 2, p , AUTHORS: 1. Amit Kapoor PARTICULARS OF CONTRIBUTORS: 1. Student, Department of MBA, Centre for Management Studies, Jamia Millia Islamia, New Delhi. NAME ADDRESS ID OF THE CORRESPONDING AUTHOR: Amit Kapoor, C-213, Janakpuri, Sahibabad, Ghaziabad , U. P. akpr22@gmail.com Date of Submission: 24/03/2015. Date of Peer Review: 25/03/2015. Date of Acceptance: 28/03/2015. Date of Publishing: 01/04/2015. Journal of Advances in Business Management / Volume 1/ Issue 1/ April 2015 Page 5