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Tomáš Jagelka

École Polytechnique – CREST, Palaiseau, France

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Author: Tomáš Jagelka

Abstract: This paper establishes an empirical mapping between economic preferences and psychological personality traits. I use the Random Preference Model to estimate distributions of risk and time preferences complete with their individual-level stability and people's propensity to make mistakes from unique experimental data. Using factor analysis to extract information on individuals' ability and personality, I show that their link with preferences is much stronger than previously documented. I explain up to 50% of the variation in both average preferences and in individuals' capacity to make consistent rational choices using four factors related to cognitive ability and three of the Big Five personality traits. Furthermore, the five structural parameters of my model largely dominate a wide range of demographic and socioeconomic variables when it comes to explaining observed individual choices between risky lotteries and time-separated payments.
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Full Text:  “Are Economists' Preferences Psychologists' Personality Traits?”