Risk Tolerance Among National Longitudinal Survey of Youth Participants: The Effects of Age and Cognitive Skills

22 Pages Posted: 12 Jun 2014

See all articles by Bidisha Mandal

Bidisha Mandal

Washington State University - School of Economic Sciences

Brian E. Roe

Ohio State University (OSU) - Department of Agricultural, Environmental & Development Economics

Date Written: July 2014

Abstract

We analyse how age and cognitive skills are related to risk tolerance among respondents to the National Longitudinal Survey of Youth between 1993 and 2006. Older individuals display lower risk tolerance than younger individuals, though as the panel ages from their early thirties to their mid‐forties, differences in risk tolerance between the oldest and youngest individuals narrow, while panel‐average risk tolerance declines. In contrast to other studies, we find that cognitive skill measured during respondents' teenage years is related to risk tolerance in a non‐linear fashion, where respondents with the lowest and highest skills reveal the greatest risk tolerance.

Suggested Citation

Mandal, Bidisha and Roe, Brian E., Risk Tolerance Among National Longitudinal Survey of Youth Participants: The Effects of Age and Cognitive Skills (July 2014). Economica, Vol. 81, Issue 323, pp. 522-543, 2014, Available at SSRN: https://ssrn.com/abstract=2449894 or http://dx.doi.org/10.1111/ecca.12088

Bidisha Mandal (Contact Author)

Washington State University - School of Economic Sciences ( email )

Pullman, WA 99164
United States

Brian E. Roe

Ohio State University (OSU) - Department of Agricultural, Environmental & Development Economics ( email )

2120 Fyffe Rd
Columbus, OH 43210-1067
United States
614-688-5777 (Phone)

HOME PAGE: http://https://aede.osu.edu/our-people/brian-e-roe

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