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Quicksand or Bedrock for Behavioral Economics? Assessing Foundational Empirical Questions

Author

Listed:
  • Victor Stango

    (University of California-Davis)

  • Joanne Yoong

    (University of Southern California, National University of Singapore, and the London School of Hygiene and Tropical Medicine)

  • Jonathan Zinman

    (Dartmouth College and NBER)

Abstract

Behavioral economics lacks empirical evidence on some foundational questions. We adapt standard elicitation methods to measure multiple behavioral factors per person in a representative U.S. sample, along with financial condition, cognitive skills, financial literacy, classical preferences, and demographics. Individually, behavioral factors are prevalent, distinct from other decision inputs, and correlate negatively with financial outcomes in richly-conditioned regressions. Conditioning further on other B-factors does not change the results, validating common practice of modeling B-factors separately. Corrections for low task/survey effort modestly strengthen the results. Our findings provide bedrock empirical foundations for behavioral economics, and offer methodological guidance for research designs.

Suggested Citation

  • Victor Stango & Joanne Yoong & Jonathan Zinman, 2018. "Quicksand or Bedrock for Behavioral Economics? Assessing Foundational Empirical Questions," Working Papers wp378, University of Michigan, Michigan Retirement Research Center.
    • Handle: RePEc:mrr:papers:wp378
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    Cited by:

    1. is not listed on IDEAS
    2. Goda, Gopi Shah & Levy, Matthew R. & Manchester, Colleen Flaherty & Sojourner, Aaron & Tasoff, Joshua, 2020. "Who is a passive saver under opt-in and auto-enrollment?," Journal of Economic Behavior & Organization, Elsevier, vol. 173(C), pages 301-321.
    3. Dániel Horn & Hubert János Kiss, 2020. "Time preferences and their life outcome correlates: Evidence from a representative survey," PLOS ONE, Public Library of Science, vol. 15(7), pages 1-26, July.
    4. Nicole Hentschel, 2025. "Risk Attitudes do not explain Cash Holdings," Working Papers 25.04, Swiss National Bank, Study Center Gerzensee.

    More about this item

    JEL classification:

    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance
    • D8 - Microeconomics - - Information, Knowledge, and Uncertainty
    • D9 - Microeconomics - - Micro-Based Behavioral Economics
    • E03 - Macroeconomics and Monetary Economics - - General - - - Behavioral Macroeconomics
    • G02 - Financial Economics - - General - - - Behavioral Finance: Underlying Principles

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