Score contribution per author:
α: calibrated so average coauthorship-adjusted count equals average raw count
Using panel data on Australian households, the relationship between risk tolerance and past stock returns is investigated across economic and financial cycles, as well as over the life-cycle and across generations. Risk tolerance is found to be procyclical with stock returns over an eight year horizon. The empirical results also reveal an inverted J-curve age risk profile, and the presence of a longer cycle across generations. Results are robust to controlling for financial crises, return volatility, real estate returns and home bias.