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Self-control and financial risk taking

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  • Sekścińska, Katarzyna
  • Rudzinska-Wojciechowska, Joanna
  • Jaworska, Diana

Abstract

We report two studies investigating the role of self-control in risky financial decision-making, operationalized as incentivized lottery task decisions. Study 1 (N = 529) investigated the link between propensity to take financial risks and trait self-control. Study 2 (N = 321) examined whether reflecting on one’s prior successes and failures in exercising self-control has an impact on subsequent risky financial decision-making. Study 1 identified a negative link between self-control and financial risk-taking, and Study 2 found that reflecting on self-control successes lowered people’s propensity to take financial risks, while reflecting on self-control failures made people more prone to take financial risks.

Suggested Citation

  • Sekścińska, Katarzyna & Rudzinska-Wojciechowska, Joanna & Jaworska, Diana, 2021. "Self-control and financial risk taking," Journal of Economic Psychology, Elsevier, vol. 85(C).
    • Handle: RePEc:eee:joepsy:v:85:y:2021:i:c:s0167487021000246
    DOI: 10.1016/j.joep.2021.102386
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    Cited by:

    1. Cobb-Clark, Deborah A. & Kong, Nancy & Schildberg-Hörisch, Hannah, 2023. "The stability of self-control in a population-representative study," Journal of Economic Psychology, Elsevier, vol. 95(C).
    2. Boto-García, David & Bucciol, Alessandro, 2023. "Couple and individual willingness to take risks," Journal of Economic Psychology, Elsevier, vol. 99(C).
    3. Sekścińska, Katarzyna & Rudzinska-Wojciechowska, Joanna & Kusev, Petko, 2022. "How decision-makers’ sense and state of power induce propensity to take financial risks," Journal of Economic Psychology, Elsevier, vol. 89(C).
    4. Fred van Raaij, W. & Riitsalu, Leonore & Põder, Kaire, 2023. "Direct and indirect effects of self-control and future time perspective on financial well-being," Journal of Economic Psychology, Elsevier, vol. 99(C).

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    More about this item

    Keywords

    Self-control; Financial risk-taking; Lottery choices;
    All these keywords.

    JEL classification:

    • D1 - Microeconomics - - Household Behavior
    • D19 - Microeconomics - - Household Behavior - - - Other
    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • G5 - Financial Economics - - Household Finance
    • G4 - Financial Economics - - Behavioral Finance
    • G40 - Financial Economics - - Behavioral Finance - - - General

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