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Biological correlates of the Allais paradox

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  • Da Silva, Sergio
  • Baldo, Dinorá
  • Matsushita, Raul

Abstract

We conducted a questionnaire study with student subjects to look for explicit correlations between selected biological characteristics of the subjects and manifestation of the Allais paradox in the pattern of their choices between sets of two pairs of risky prospects. We find that particular bio-characteristics, such as gender, menstrual cycle, mother’s age, parenthood, digit ratio, perceived negative life events, and emotional state, can be related to the paradox. Women, in particular if not menstruating, are less susceptible to the paradox. Those born to not-too-young mothers are also less prone to the paradox. The same holds true for those who father children, those with high prenatal testosterone exposure, who have reported many negative life events, and those who were anxious, excited, aroused, happy, active, and fresh at the time of the experiment. Further, left-handers and atheists may be less inclined to exhibit the paradox.

Suggested Citation

  • Da Silva, Sergio & Baldo, Dinorá & Matsushita, Raul, 2009. "Biological correlates of the Allais paradox," MPRA Paper 18938, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:18938
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    References listed on IDEAS

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    1. Pearson, Matthew & Schipper, Burkhard C, 2009. "The Visible Hand: Finger ratio (2D:4D) and competitive behavior," MPRA Paper 16785, University Library of Munich, Germany.
    2. Newton Da Costa & Carlos Mineto & Sergio Da Silva, 2008. "Disposition effect and gender," Applied Economics Letters, Taylor & Francis Journals, vol. 15(6), pages 411-416.
    3. Conlisk, John, 1989. "Three Variants on the Allais Example," American Economic Review, American Economic Association, vol. 79(3), pages 392-407, June.
    4. Eckel, Catherine C. & Grossman, Philip J., 2008. "Men, Women and Risk Aversion: Experimental Evidence," Handbook of Experimental Economics Results, in: Charles R. Plott & Vernon L. Smith (ed.), Handbook of Experimental Economics Results, edition 1, volume 1, chapter 113, pages 1061-1073, Elsevier.
    5. Daniel Kahneman & Amos Tversky, 2013. "Prospect Theory: An Analysis of Decision Under Risk," World Scientific Book Chapters, in: Leonard C MacLean & William T Ziemba (ed.), HANDBOOK OF THE FUNDAMENTALS OF FINANCIAL DECISION MAKING Part I, chapter 6, pages 99-127, World Scientific Publishing Co. Pte. Ltd..
    6. Pearson, Matthew & Schipper, Burkhard C, 2009. "The Visible Hand: Finger ratio (2D:4D) and competitive behavior," MPRA Paper 16785, University Library of Munich, Germany.
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    Cited by:

    1. Crosetto, P. & Filippin, A., 2017. "Safe options induce gender differences in risk attitudes," Working Papers 2017-05, Grenoble Applied Economics Laboratory (GAEL).
    2. Kolnhofer-Derecskei Anita, 2017. "The Indifferent, the Good Samaritan, the Brave and the Agent in Allais Paradox situation – or How Endowment Effect Influences Our Decision in Case of Allais Paradox?," Organizacija, Sciendo, vol. 50(4), pages 299-313, December.
    3. Paolo Crosetto & Antonio Filippin, 2023. "Safe options and gender differences in risk attitudes," Journal of Risk and Uncertainty, Springer, vol. 66(1), pages 19-46, February.
    4. A. Felipe Rodrigues & Newton Da Costa & Sergio Da Silva, 2011. "Overconfidence and excess entry: a comparison between students and managers," Economics Bulletin, AccessEcon, vol. 31(3), pages 2549-2557.
    5. Sergio Da Silva & Dinorá De Faveri & Ana Correa & Raul Matsushita, 2017. "High-income consumers may be less hyperbolic when discounting the future," Economics Bulletin, AccessEcon, vol. 37(3), pages 1421-1434.
    6. Da Silva, Sergio & Moreira, Bruno & Da Costa Jr, Newton, 2014. "Preschoolers and the Endowment Effect," MPRA Paper 60568, University Library of Munich, Germany.

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    More about this item

    Keywords

    Allais paradox; choice under risk; biological characteristics;
    All these keywords.

    JEL classification:

    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior

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