nep-neu New Economics Papers
on Neuroeconomics
Issue of 2011‒03‒05
two papers chosen by
Daniel Houser
George Mason University

  1. Income and Ideology: How Personality Traits, Cognitive Abilities, and Education Shape Political Attitudes By Rebecca Morton; Jean-Robert Tyran; Erik Wengström
  2. Measuring Individual Risk Attitudes in the Lab: Task or Ask? An Empirical Comparison By Jan-Erik Lönnqvist; Markku Verkasalo; Gari Walkowitz; Philipp C. Wichardt

  1. By: Rebecca Morton (Department of Politics, New York University); Jean-Robert Tyran (Department of Economics, University of Vienna); Erik Wengström (Department of Economics, University of Copenhagen)
    Abstract: We find that cognitive abilities, educational attainment, and some personality traits indirectly affect ideological preferences through changes in income. The effects of changes in personality traits on ideology directly and indirectly through income are in the same direction. However, the indirect effects of cognitive abilities and education often offset the direct effects of these variables on ideological preferences. That is, increases in cognitive abilities and education significantly increase income, which reduces the tendency of individuals to express leftist preferences. These indirect effects are in some cases sizeable relative to direct effects. The indirect effects of cognitive abilities through income overwhelm the direct effects such that increasing IQ increases rightwing preferences. For ideological preferences over economic policy the indirect effects of advanced education also overwhelm the direct effects, such that individuals with higher education are more likely to express rightwing preferences than those with lower education.
    Date: 2011–01
    URL: http://d.repec.org/n?u=RePEc:kud:kuiedp:1108&r=neu
  2. By: Jan-Erik Lönnqvist (Faculty of Behavioural Sciences, University of Helsinki, Finland); Markku Verkasalo (Faculty of Behavioural Sciences, University of Helsinki, Finland); Gari Walkowitz (Department of Management, University of Cologne, Germany); Philipp C. Wichardt (Institute of Economic Theory 3, University of Bonn, Germany)
    Abstract: This paper compares two prominent empirical measures of individual risk attitudes - the Holt and Laury (2002) lottery-choice task and the multi-item questionnaire advocated by Dohmen, Falk, Huffman, Schupp, Sunde and Wagner (forthcoming) - with respect to (a) their within-subject stability over time (one year) and (b) their correlation with actual risk-taking behaviour in the lab - here the amount sent in a trust game (Berg, Dickaut, McCabe, 1995). As it turns out, the measures themselves are uncorrelated (both times) and, most importantly, only the questionnaire measure exhibits test-re-test stability (Ï = .78), while virtually no such stability is found in the lottery-choice task. In addition, only the questionnaire measure shows the expected correlations with a Big Five personality measure and is correlated with actual risk-taking behaviour. The results suggest that the questionnaire measure is a better measure of individual risk attitudes than the lottery-choice task. Moreover, with respect to trust, the high re-test stability of trust transfers (Ï = .70) further supports the conjecture that trusting behaviour indeed has a component which itself is a stable individual characteristic (Glaeser, Laibson, Scheinkman and Soutter, 2000).
    Keywords: Risk Attitudes, Trust, Personality, Lab Experiments
    JEL: D81 C91 Z10
    Date: 2011–02–18
    URL: http://d.repec.org/n?u=RePEc:cgr:cgsser:02-03&r=neu

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