Back to Browse Journals » Neuroscience and Neuroeconomics » Volume 1

Differences in risk aversion between young and older adults

Authors Albert SM, Duffy J

Published Date February 2012 Volume 2012:1 Pages 3—9

DOI http://dx.doi.org/10.2147/NAN.S27184

Received 10 October 2011, Accepted 11 January 2012, Published 14 February 2012

Steven M Albert1, John Duffy2

1Department of Behavioral and Community Health Sciences, 2Department of Economics, University of Pittsburgh, Pittsburgh, PA, USA

Abstract: Research on decision-making strategies among younger and older adults suggests that older adults may be more risk averse than younger people in the case of potential losses. These results mostly come from experimental studies involving gambling paradigms. Since these paradigms involve substantial demands on memory and learning, differences in risk aversion or other features of decision making attributed to age may in fact reflect age-related declines in cognitive abilities. In the current study, older and younger adults completed a simpler, paired lottery choice task used in the experimental economics literature to elicit risk aversion. A similar approach was used to elicit participants' discount rates. The older adult group was more risk averse than the younger (P < 0.05) and had a higher discount rate (15.6%–21.0% versus 10.3%–15.5%, P < 0.01), indicating lower expected utility from future income. Risk aversion and implied discount rates were weakly correlated. It may be valuable to investigate developmental changes in neural correlates of decision making across the lifespan.

Keywords: aging, decision making, risk, time preference, behavioral economics

Download Article [PDF] 

Creative Commons License This work is published by Dove Medical Press Limited, and licensed under Creative Commons Attribution - Non Commercial (unported, v3.0) License. The full terms of the License are available at http://creativecommons.org/licenses/by-nc/3.0/. Non-commercial uses of the work are permitted without any further permission from Dove Medical Press Limited, provided the work is properly attributed. Permissions beyond the scope of the License are administered by Dove Medical Press Limited. Information on how to request permission may be found at: http://www.dovepress.com/permissions.php

Readers of this article also read:

Pharmacokinetics and pharmacodynamics of acetylsalicylic acid after intravenous and oral administration to healthy volunteers

Nagelschmitz J, Blunck M, Kraetzschmar J, Ludwig M, Wensing G, Hohlfeld T

Clinical Pharmacology: Advances and Applications 2014, 6:51-59

Published Date: 19 March 2014

Population pharmacokinetics of olprinone in healthy male volunteers

Kunisawa T, Kasai H, Suda M, Yoshimura M, Sugawara A, Izumi Y, Iida T, Kurosawa A, Iwasaki H

Clinical Pharmacology: Advances and Applications 2014, 6:43-50

Published Date: 4 March 2014

To buy or not buy? A review of affective priming in purchase decision

Mograbi GJ, Mograbi DC

Neuroscience and Neuroeconomics 2012, 1:25-35

Published Date: 31 August 2012

Detemir as a once-daily basal insulin in type 2 diabetes

Nelson SE

Clinical Pharmacology: Advances and Applications 2011, 3:27-37

Published Date: 18 August 2011

Implementing the 2009 Institute of Medicine recommendations on resident physician work hours, supervision, and safety

Blum AB, Shea S, Czeisler CA, Landrigan CP, Leape L

Nature and Science of Sleep 2011, 3:47-85

Published Date: 24 June 2011

Adherence and persistence with branded antidepressants and generic SSRIs among managed care patients with major depressive disorder

Xianchen Liu, Yi Chen, Douglas E Faries, et al

ClinicoEconomics and Outcomes Research 2011, 3:63-72

Published Date: 15 March 2011