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Understanding the Correlation between Alzheimer’s Disease Polygenic Risk, Wealth, and the Composition of Wealth Holdings

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  • Su H. Shin
  • Dean R. Lillard
  • Jay Bhattacharya

Abstract

We investigate how the genetic risk of developing Alzheimer's Disease (AD) relates to saving behavior. Using nationally representative data from the 1992-2014 Health and Retirement Study (HRS), we find that genetic predisposition for AD correlates with, but is not causally related to older individuals’ wealth holdings. People with higher Alzheimer’s Disease polygenic risk score (PGS) hold roughly 9 percent more wealth in CDs (hands-off assets) and around 11 percent, 15 percent, and 7 percent less wealth in stocks, IRAs, and other financial assets (hands-on assets) respectively. We explore three hypotheses that could explain these correlations. We hypothesize that people with high risk of AD choose different portfolios because: (i) they know their polygenic risk of developing Alzheimer’s Disease and related dementia, (ii) they have lower cognitive capacity, and (iii) the genome-wide association studies (GWAS) process that generated the Alzheimer’s Disease PGS failed to fully account for the aging process. Our extended model results do not support the first two hypotheses. Consistent with the third hypothesis, the interaction between age and the Alzheimer’s Disease PGS explains the correlation between genetic traits and asset holdings.

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  • Su H. Shin & Dean R. Lillard & Jay Bhattacharya, 2019. "Understanding the Correlation between Alzheimer’s Disease Polygenic Risk, Wealth, and the Composition of Wealth Holdings," NBER Working Papers 25526, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:25526
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    Cited by:

    1. Paul Minard, 2022. "Molecular genetics and mid-career economic mobility," Papers 2209.00057, arXiv.org.
    2. Amitabh Chandra & Courtney Coile & Corina Mommaerts, 2023. "What Can Economics Say about Alzheimer's Disease?," Journal of Economic Literature, American Economic Association, vol. 61(2), pages 428-470, June.
    3. Nicolau Martin‐Bassols & Sonja C. de New & David W. Johnston & Michael A. Shields, 2023. "Cognitive activity at work and the risk of dementia," Health Economics, John Wiley & Sons, Ltd., vol. 32(7), pages 1561-1580, July.

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    JEL classification:

    • D1 - Microeconomics - - Household Behavior
    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior

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