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The visible hand: finger ratio (2D:4D) and competitive bidding

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  • Matthew Pearson
  • Burkhard Schipper

Abstract

In an experiment using two-bidder first-price sealed bid auctions with symmetric independent private values and 400 subjects, we scan also the right hand of each subject. We study how the ratio of the length of the index and ring fingers (2D:4D) of the right hand, a measure of prenatal hormone exposure, is correlated with bidding behavior and total profits. 2D:4D has been reported to predict competitiveness in sports competition (Manning and Taylor in Evol. Hum. Behav. 22:61–69, 2001 , and Hönekopp et al. in Horm. Behav. 49:545–549, 2006 ), risk aversion in lottery tasks (Dreber and Hoffman in Portfolio selection in utero. Stockholm School of Economics, 2007 ; Garbarino et al. in J. Risk Uncertain. 42:1–26, 2011 ), and the average profitability of high-frequency traders in financial markets (Coates et al. in Proc. Natl. Acad. Sci. 106:623–628, 2009 ). We do not find any significant correlation between 2D:4D on either bidding or profits. However, there might be racial differences in the correlation between 2D:4D and bidding and profits. Copyright Economic Science Association 2012

Suggested Citation

  • Matthew Pearson & Burkhard Schipper, 2012. "The visible hand: finger ratio (2D:4D) and competitive bidding," Experimental Economics, Springer;Economic Science Association, vol. 15(3), pages 510-529, September.
  • Handle: RePEc:kap:expeco:v:15:y:2012:i:3:p:510-529
    DOI: 10.1007/s10683-011-9311-7
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    More about this item

    Keywords

    Hormones; Digit ratio; 2D:4D; Risk behavior; Competition; Competitive behavior; Auctions; Bidding; Endocrinological economics; C72; C91; C92; D44; D81; D87;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • D87 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Neuroeconomics

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