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Are Time Preference and Risk Preference Associated with Cognitive Intelligence and Emotional Intelligence?

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  • Lucy F. Ackert
  • Richard Deaves
  • Jennifer Miele
  • Quang Nguyen

Abstract

The authors investigated whether cognitive intelligence (intelligence quotient [IQ]) and emotional intelligence (emotional quotient [EQ]) meaningfully correlate with time preference and risk preference, finding solid evidence in support. In the realm of time preference, high-EQ individuals are less subject to present (or future) bias and more patient. Further, high-IQ subjects tend to exhibit preferences that conform to expected utility maximization. While recent research on the relationship between cognitive ability and preferences has provided important insights, the results suggest that both cognitive intelligence and emotional intelligence matter.

Suggested Citation

  • Lucy F. Ackert & Richard Deaves & Jennifer Miele & Quang Nguyen, 2020. "Are Time Preference and Risk Preference Associated with Cognitive Intelligence and Emotional Intelligence?," Journal of Behavioral Finance, Taylor & Francis Journals, vol. 21(2), pages 136-156, April.
    • Handle: RePEc:taf:hbhfxx:v:21:y:2020:i:2:p:136-156
    DOI: 10.1080/15427560.2019.1663850
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