Economic Locus of control and financial risk attitude: Evidence from Faisalabad
DOI:
https://doi.org/10.54938/ijemdss.2026.05.3.742Keywords:
Economic locus of control, Risk tolerance, Risk behavior, Risk attitudeAbstract
Main objective of this study was to estimate the effect of economic locus of control on risk tolerance, risk behavior, and risk attitude. The study also determined the effect of economic locus of control on investment intention by mediating the role of attitude toward financial risk. Risk tolerance and risk behavior were measured by set of questions from the respondents. For this study data was gathered by conducting a questionnaire survey from 201 respondents from Faisalabad, Pakistan. Logistic regression and generalized structural equation modeling were used to estimate the relationship between variables and the results show that the respondents with an internal economic locus of control are less likely to have risk-averting behavior than the respondents with an external economic locus of control. The respondents with an internal economic locus of control are more willing to invest in saving accounts or the bond market than the respondents with an external economic locus of control. The respondents with an internal economic locus of control are more willing to take risks.
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