Working Paper: NBER ID: w25723
Authors: James Andreoni; Amalia Di Girolamo; John A. List; Claire Mackevicius; Anya Samek
Abstract: We conduct experiments eliciting risk preferences with over 1,400 children and adolescents aged 3-15 years old. We complement our data with an assessment of cognitive and executive function skills. First, we find that adolescent girls display significantly greater risk aversion than adolescent boys. This pattern is not observed among young children, suggesting that the gender gap in risk preferences emerges in early adolescence. Second, we find that at all ages in our study, cognitive skills (specifically math ability) are positively associated with risk taking. Executive functions among children, and soft skills among adolescents, are negatively associated with risk taking. Third, we find that greater risk-tolerance is associated with higher likelihood of disciplinary referrals, which provides evidence that our task is equipped to measure a relevant behavioral outcome. For academics, our research provides a deeper understanding of the developmental origins of risk preferences and highlights the important role of cognitive and executive function skills to better understand the association between risk preferences and cognitive abilities over the studied age range.
Keywords: risk preferences; gender differences; cognitive skills; executive functions; soft skills
JEL Codes: C72; C91; C93
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Gender (female) (J16) | Risk Aversion (higher in girls than boys) (D81) |
| Cognitive Skills (math ability) (C60) | Risk Taking (positive association) (D81) |
| Executive Functions (D87) | Risk Taking (negative association among children) (D81) |
| Executive Functions (D87) | Risk Taking (weakly positive among adolescents) (D81) |
| Self-Control (D91) | Risk Taking (lower risk-taking) (D81) |