While human trafficking often conjures up images of victims being taken by force, in reality, a minority of today’s slave population are physically abducted. Rather, a significant share of human trafficking victims are “pushed” (e.g., trying to escape crisis conditions) or “pulled” (e.g., pursuing the prospect of economic opportunities) into situations of high risk. This study focuses on those who are “pulled” into risky scenarios, assessing when individuals make decisions that may put themselves at risk. I assume that individuals are boundedly rational, and propose an aspiration-based model of decision-making, which predicts that increased salience in relative deprivation can lead individuals to be more risk-seeking, putting themselves and their children at greater risk for exploitation. Using both an original survey experiment and nationally-representative data in Nepal, I find that consistent with the theoretical model, perceptions of relative deprivation induce more risk-seeking behavior. This result speaks to the interaction between inequality and risk tolerance, and how economic and social forces that alter perceived relative deprivation can increase vulnerability to exploitation. © 2017, Springer Science+Business Media New York.

prospect theory Risk Bounded rationality Human trafficking relative deprivation

[No Keywords available]