Measures of cognitive ability and choice inconsistency

Helene  Willadsen; Sarah  Zaccagni; Marco Piovesan; Erik Wengström

doi:10.1016/j.jebo.2024.02.029

Measures of cognitive ability and choice inconsistency

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

^*Corresponding author for this work

Helsinki GSE, Helsinki

Research output: Contribution to journal › Article › Scientific › peer-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 language	English
Peer-reviewed scientific journal	Journal of Economic Behavior & Organization
Volume	220
Pages (from-to)	495-506
Number of pages	12
ISSN	0167-2681
DOIs	https://doi.org/10.1016/j.jebo.2024.02.029
Publication status	Published - 28.02.2024
MoE publication type	A1 Journal article - refereed

Keywords

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

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note = "Funding Information: We are extremely grateful to the editors Daniela Puzzello and Eugenio Proto, and to two anonymous reviewers for their feedback. We thank the Carlsberg Foundation for generous financial support (Project: 108579). The activities of CEBI are financed by the Danish National Research Foundation, Grant DNRF134. Helene Willadsen gratefully acknowledges funding from the H2020 European Research Council (grant number 834540) as part of the project “DISTRACT”. We thank the numerous collaborators and students who have helped us in preparing and running this experiment. We thank the staff at the participating schools, the participating children, and their parents. Publisher Copyright: {\textcopyright} 2024 The Author(s)",

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Measures of cognitive ability and choice inconsistency

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Keywords

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