21 June, 10.50-11.20: Kelly Wolfe, University of Essex
Age differences in risk-taking behaviour: a matter of risk-attitude or decision-quality?
Introduction: Previous research examining age differences in decision-making under risk has yielded mixed findings. Some studies have reported greater risk-taking in older age compared to younger adults, other studies have reported less risk-taking in older age, and other studies have reported no age differences. What factors underlie these mixed findings regarding adult age differences in risk-taking tendencies? We propose that the mixed findings result at least partly from the multitude of different methods and materials used to measure risk-taking behaviour. Specifically, we propose that some tasks used to assess risk-taking tendencies may be more cognitively demanding or require more proficient numeracy skills than other tasks, and as such, load more heavily on cognitive abilities and numeracy skills that decline in older age. Thus, age differences in decision-making on risk-taking tasks may result from both or either (a) age differences in decision-making quality due to age-related decline in cognitive abilities and numeracy and (b) age differences in attitudes towards risk-taking. The aim of our research is to disentangle the contribution of decision-making quality and risk-taking attitude to age differences in decision-making under risk.
Method: Participants evaluated 10 monetary gambles and estimated what they believed to be the expected value of each gamble. They were asked to do so by mimicking the probabilities of the outcomes associated with each gamble in a box with 20 compartments. Each gamble had three possible outcomes; a probability to win, a probability to lose, and a probability to neither win nor lose. For each gamble, participants were asked to identify the frequency of win, loss, and neither win nor lose outcomes imagining that the gamble were played 20 times. This method assessed participants’ understanding of the probabilities associated with the three possible gamble outcomes (i.e., win, lose, neither win nor lose). Following completion of this task, participants received feedback about their judged expected value of each gamble based on the frequency that they determined for each possible outcome. Participants were then asked to decide whether they wished to play each of the gambles. Following all decisions, participants received as monetary payment any winnings they had accrued across the 10 gambles. Cognitive ability was assessed using measures of processing speed and backward digit span. Numeracy was assessed with an 11-item numeracy scale. Positive and negative affect and self-reported risk-taking were also assessed.
Results: Correct judgements of the probability to win and lose were associated with numerical ability, irrespective of age. Incorrect judgments of the probability to win and lose were associated with age, as older age predicted a larger distance between participant’s estimation and the actual probabilities to win and lose. A higher likelihood of accepting to play a gamble was associated with incorrectly judging the probability of winning as higher than the actual probability to win or incorrectly judging the probability of losing as lower than the actual probability to lose. Also, higher numerical ability was also associated with a lower likelihood of accepting gambles. Age was not associated with likelihood of accepting to play gambles.
Conclusion: Our findings suggest that numerical abilities play a large role in assessing the value of a monetary gamble, irrespective of age, nor did younger and older adults differ in the likelihood of accepting these gambles. However, when probabilities to win and lose were incorrectly estimated, older age was related to a larger distance between the estimated and the actual probability to win and lose.