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Last updated on April 20, 2014 at 21:20 EDT

Financial Risk Linked to Testosterone

September 30, 2008

Higher levels of testosterone may influence how individuals make risky financial decisions, U.S. researchers suggest.

Anna Dreber of Harvard University and the Stockholm School of Economics and Coren Apicella of Harvard University said men’s testosterone levels assessed before participation in an investment game showed that males with higher testosterone levels invested more.

“The findings help us to understand the motivations for risk-taking behavior, which is a major component of economic theory,” Dreber said in a statement. “Risk preferences are one of the most important preferences in economics, and yet no one knows why they differ between men and women, why they change over age, or what makes men trade more in the financial market.”

In the study, saliva samples were taken from 98 males, ages 18 to 23, before participation in the investment game, so the researchers were certain that testosterone levels were not elevated as a result of the game.

The study, published in Evolution and Human Behavior, found that a man whose testosterone levels were more than one standard deviation above the mean invested 12 percent more than the average man into the risky investment.

Previous studies have shown that on average, men are more likely than women to take risks.