Measures of cognitive ability and choice inconsistency

Helene Willadsen, Sarah Zaccagni *, Marco Piovesan, Erik Wengström

*Corresponding author for this work

Research output: Contribution to journalArticleScientificpeer-review

Abstract

Cognitive skills affect individual choices. Researchers commonly use Raven's Progressive Matrices (RPM) tests and the Cognitive Reflection Test (CRT) to assess the relationship between cognitive abilities and economic decision making. In this paper, we study the relationship between these measures, and investigate the extent to which they are correlated and whether they are best described as substitutes or complements. Combining a sample of 686 children and a sample of 2,332 adults, we compare individual performances in the RPM test and CRT test. First, we report a significant positive correlation between the two measures of 0.3. Second, we document that performance in both the RPM test and CRT are significant predictors of behavioral inconsistency observed in incentivized time and risk preference elicitation tasks for children and risk preference elicitation task for adults.

Original languageEnglish
Peer-reviewed scientific journalJournal of Economic Behavior & Organization
Volume220
Pages (from-to)495-506
Number of pages12
ISSN0167-2681
DOIs
Publication statusPublished - 28.02.2024
MoE publication typeA1 Journal article - refereed

Keywords

  • 511 Economics
  • Cognitive Reflection
  • Cognitive Skills
  • Inconsistent Behavior
  • Intelligence
  • Raven Progressive Matrices
  • Risk Preference
  • Time Preference

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