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Cognitive ability and risk preferences in a developing nation : findings from the field
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Moghaddasi Kelishomi, Ali and Sgroi, Daniel (2022) Cognitive ability and risk preferences in a developing nation : findings from the field. Economics Letters, 216 . 110576. doi:10.1016/j.econlet.2022.110576 ISSN 0165-1765.
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Official URL: http://dx.doi.org/10.1016/j.econlet.2022.110576
Abstract
We find a strong positive relationship between risk tolerance and cognitive ability which becomes stronger as adherence to the generalized axiom of revealed preference (a proxy for rationality) increases. In contrast to typical studies of this sort, our results are taken from a field study of individuals at the very bottom of the income distribution in a developing nation. Our results for some of the poorest in the world support a link between cognitive ability and risk preferences. We merge this with findings from developed nations and argue that our overall findings suggest a stable relationship for the human population as a whole irrespective of socio-economic status.
Item Type: | Journal Article | ||||||||
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Subjects: | B Philosophy. Psychology. Religion > BF Psychology H Social Sciences > HB Economic Theory |
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Divisions: | Faculty of Social Sciences > Economics | ||||||||
Library of Congress Subject Headings (LCSH): | Risk, Risk -- Developing nation, Cognition, Rationalism, Field experiments | ||||||||
Journal or Publication Title: | Economics Letters | ||||||||
Publisher: | Elsevier | ||||||||
ISSN: | 0165-1765 | ||||||||
Official Date: | July 2022 | ||||||||
Dates: |
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Volume: | 216 | ||||||||
Article Number: | 110576 | ||||||||
DOI: | 10.1016/j.econlet.2022.110576 | ||||||||
Status: | Peer Reviewed | ||||||||
Publication Status: | Published | ||||||||
Access rights to Published version: | Open Access (Creative Commons) | ||||||||
Date of first compliant deposit: | 18 May 2022 | ||||||||
Date of first compliant Open Access: | 18 May 2022 | ||||||||
RIOXX Funder/Project Grant: |
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