title: Cognitive Abilities and Behavioral Biases
creator: Oechssler, Jörg
creator: Roider, Andreas
creator: Schmitz, Patrick W.
subject: 330
subject: 330 Economics
description: We use a simple, three-item test for cognitive abilities to investigate whether established behavioral biases that play a prominent role in behavioral economics and finance are related to cognitive abilities. We find that higher test scores on the Cognitive Reflection Test of Frederick (2005) indeed are correlated with lower incidences of the conjunction fallacy, conservatism in updating probabil-ities, and overconfidence. Test scores are also significantly related to subjects' time and risk preferences. We find no influence on anchoring. However, even if biases are lower for people with higher cognitive abilities, they still remain substantial. 
date: 2008
type: Working paper
type: info:eu-repo/semantics/workingPaper
type: NonPeerReviewed
format: application/pdf
identifier: https://archiv.ub.uni-heidelberg.de/volltextserverhttps://archiv.ub.uni-heidelberg.de/volltextserver/9463/1/Oechssler_Roider_Schmitz08_dp465.pdf
identifier: DOI:10.11588/heidok.00009463
identifier: urn:nbn:de:bsz:16-opus-94635
identifier:   Oechssler, Jörg ; Roider, Andreas ; Schmitz, Patrick W.  (2008) Cognitive Abilities and Behavioral Biases.  [Working paper]     
relation: https://archiv.ub.uni-heidelberg.de/volltextserver/9463/
rights: info:eu-repo/semantics/openAccess
rights: http://archiv.ub.uni-heidelberg.de/volltextserver/help/license_urhg.html
language: eng