The Relationship between Cognitive Ability and Risk Preferences in a Developing Nation: Findings from the Field

Arbeitspapier

We find a strong relationship between risk-loving preferences and cognitive ability which becomes stronger as adherence to the generalized axiom of revealed preference (a proxy for rationality) increases. 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 recent findings drawn from subjects in wealthy Western nations, suggesting there may be a stable relationship between risk preferences and cognitive ability for the human population as a whole irrespective of socio-economic status.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IZA Discussion Papers ; No. 15266

Classification and Topics

• Classification: Wirtschaft ; Analysis of Health Care Markets ; Health Behavior ; Health: Government Policy; Regulation; Public Health ; Field Experiments
• Subject: risk ; cognitive ability ; rationality ; generalized axiom of revealed preference ; field experiment ; low incomes ; developing nation

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Moghaddasi Kelishomi, Ali ; Sgroi, Daniel
• Event: Veröffentlichung
• (who): Institute of Labor Economics (IZA)
• (where): Bonn
• (when): 2022

Further information

• Handle: http://hdl.handle.net/10419/263482
• Last update: 10.03.2025, 11:43 AM CET