This setting lets you change the way you view articles. You can choose to have articles open in a dialog window, a new tab, or directly in the same window.
Open in Dialog
Open in New Tab
Open in same window

American Economic Review: Vol. 100 No. 3 (June 2010)

AER Volume. 100, Issue 3 | leftPrevious ArticleNext Articleright

Expand

Quick Tools:

Print Article Summary Email Link to this Article Export Citation
Sign up for Email Alerts Follow us on Twitter

Explore:

AER - All Issues

AER Forthcoming Articles

Are Risk Aversion and Impatience Related to Cognitive Ability?

Article Citation

Dohmen, Thomas, Armin Falk, David Huffman, and Uwe Sunde. 2010. "Are Risk Aversion and Impatience Related to Cognitive Ability?." American Economic Review, 100(3): 1238-60.

DOI: 10.1257/aer.100.3.1238

Abstract

This paper investigates whether there is a link between cognitive ability, risk aversion, and impatience, using a representative sample of roughly 1,000 German adults. Subjects participate in choice experiments with monetary incentives measuring risk aversion, and impatience over an annual horizon, and conduct two different, widely used, tests of cognitive ability. We find that lower cognitive ability is associated with greater risk aversion, and more pronounced impatience. These relationships are significant, and robust to controlling for personal characteristics, education, income, and measures of credit constraints. We perform a series of additional robustness checks, which help rule out other possible confounds.

Article Full-Text Access

Full-text Article

Additional Materials

Download Data Set (130.19 KB)

Authors

Dohmen, Thomas (Research Centre for Education and the Labour Market, Maastricht U)
Falk, Armin (U Bonn)
Huffman, David (Swarthmore College)
Sunde, Uwe (U St Gallen)

JEL Classifications

D12: Consumer Economics: Empirical Analysis
D81: Criteria for Decision-Making under Risk and Uncertainty


American Economic Review



AEA Member Login:


Quick Tools:

Email Link to this Issue

Sign up for Email Alerts

Follow us on Twitter

Subscription Information
(Institutional Administrator Access)

Explore:

AER - All Issues

AER - Forthcoming Articles

AEA Journals

Virtual Field Journals

AEAweb | AEA Journals | Contact Us