Tomas Jagelka '11 (Ecole Polytechnique-CREST) will present:
"Are Economists' Preferences Psychologists' Personality Traits?"
at 12:15pm on Thursday, October 25, 2018 in 310 Silsby.

If you will be attending the Lunch Seminar and have not already done so, please RSVP so we can order the appropriate amount of food.
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ABSTRACT:
This paper takes advantage of a unique Canadian field experiment to establish a mapping between economic primitives and the Big Five personality traits, incorporated as latent factors. It is the first to estimate population distributions of risk aversion and discount rates as well as of parameters governing their stability using the Random Preference Model. Results show that both preference and rationality parameters are important in determining individuals' choices - while the former largely explain their central tendency, the latter account for deviations from it. The conscientiousness trait explains the largest part of their population variation (50% for the discount rate). Furthermore, the extraversion trait is related to lower risk aversion while high cognitive ability leads to more rational choices. However, unobserved heterogeneity still accounts for a majority of the variation in the parameters. This finding confirms that economists' preferences are much more than a simple extension of psychologists' personality traits.







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