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Research Details

UM15-06 - Sources of Lower Financial Decision-making Ability at Older Ages

Daniel Silverman and Shachar Kariv

The proposed research would investigate the possible negative relationship between age and financial decision-making ability. We will consider three main hypotheses. (1) Findings of a negative relationship between age and economic decision-making ability are not the consequences of a causal link between age and financial decision-making, but instead the consequences of older people being born in an earlier cohort and now facing a less familiar economic environment. (2) The negative relationship between age and financial decision-making ability is a consequence of the normal aging process and can be well-captured by declines in other cognitive functions. (3) The negative relationship between financial decision-making ability and age is driven by those individuals who have experienced important declines in health that may or may not be associated with declines in other cognitive functions.

Publications (PDF)

Brief:
Sources of Lower Financial Decision-making Ability at Older Ages
Working Paper(s):
Sources of Lower Financial Decision-making Ability at Older Ages
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