smart men are risk takers, smart women are patient?

["Gary Funck" <gary () intrepid com>]

[There must be a security implication in here somewhere. <g>]

http://www.nytimes.com/2006/01/26/business/26scene.html

January 26, 2006
Economic Scene
Would You Take the Bird in the Hand, or a 75% Chance at the Two in the Bush?
By VIRGINIA POSTREL

WOULD you rather have $1,000 for sure or a 90 percent chance of $5,000? A
guaranteed $1,000 or a 75 percent chance of $4,000?
In economic theory, questions like these have no right or wrong answers.
Even if a gamble is mathematically more valuable - a 75 percent chance of
$4,000 has an expected value of $3,000, for instance - someone may still
prefer a sure thing.
People have different tastes for risk, just as they have different tastes
for ice cream or paint colors. The same is true for waiting ...
[...]
But high scorers - those who get all the questions right - do prefer taking
risks.
"Even when it actually hurts you on average to take the gamble, the smart
people, the high-scoring people, actually like it more," Professor Frederick
said in an interview. Almost a third of high scorers preferred a 1 percent
chance of $5,000 to a sure $60.
They are also more patient, particularly when the difference, and the
implied interest rate, is large. Choosing $3,400 this month over $3,800 next
month implies an annual discount rate of 280 percent. Yet only 35 percent of
low scorers - those who missed every question - said they would wait, while
60 percent of high scorers preferred the later, bigger payoff.

Men and women also show different results. "Expressed loosely," he writes,
"being smart makes women patient and makes men take more risks."
High-scoring women show slightly more willingness to wait than high-scoring
men, while the differences in risk-taking are much larger. High-scoring
women are about as willing to gamble as low-scoring men, while low-scoring
women are even more risk-averse
For instance, 80 percent of high-scoring men would pick a 15 percent chance
of $1 million over a sure $500, compared with only 38 percent of
high-scoring women, 40 percent of low-scoring men and 25 percent of
low-scoring women.
[...]


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