Genetic determinants of financial risk taking

Abstract

Individuals vary in their willingness to take financial risks. Here we show that variants of two genes that regulate dopamine and serotonin neurotransmission and have been previously linked to emotional behavior, anxiety and addiction (5-HTTLPR and DRD4) are significant determinants of risk taking in investment decisions. We find that the 5-HTTLPR s/s allele carriers take 28% less risk than those carrying the s/l or l/l alleles of the gene. DRD4 7-repeat allele carriers take 25% more risk than individuals without the 7-repeat allele. These findings contribute to the emerging literature on the genetic determinants of economic behavior.

Figure 1

(A) Trial structure of the investment task. For 6 seconds subjects observe the two possible and equally-likely values of the return of the risky asset, the return of the safe asset and the amount they have to invest that trial. When the word “Choice” appears on the screen, subjects have 6 seconds to enter the amount they wish to invest in the risky asset. Their remaining funds are automatically invested in the safe asset. A 2-second fixation screen precedes a new trial. (B) 5-HTTLPR and risk taking propensity. Individuals carrying one or two copies of the l allele demonstrated significantly greater risk taking relative to individuals carrying two copies of the s allele (p<0.02). Error bars indicate standard errors. (C) DRD4 and risk taking propensity. Individuals carrying the 7-repeat allele demonstrated significantly greater risk taking relative to individuals without the 7-repeat allele (p<0.04). Error bars indicate standard errors.