Risk Preferences and Prenatal Exposure to Sex Hormones for Ladinos

Risk preferences drive much of human decision making including investment, career and health choices and many more. Thus, understanding the determinants of risk preferences refines our understanding of choice in a broad array of environments. We assess the relationship between risk preferences, prenatal exposure to sex hormones and gender for a sample of Ladinos, which is an ethnic group comprising 62.86% of the population of Guatemala. Prenatal exposure to sex hormones has organizational effects on brain development, and has been shown to partially explain risk preferences for Caucasians. We measure prenatal exposure to sex hormones using the ratio of the length of the index finger to the length of the ring finger (2D:4D), which is negatively (positively) correlated with prenatal exposure to testosterone (estrogen). We find that Ladino males are less risk averse than Ladino females, and that Ladino males have lower 2D:4D ratios than Ladino females on both hands. We find that the 2D:4D ratio does not explain risk preferences for Ladinos. This is true for both genders, and both hands. Our results highlight the importance of exploring the behavioral significance of 2D:4D in non-Caucasian racial groups.


The instructions follow:
In this Activity you will not have to add more numbers. This time you will have two options -OPTION A and OPTION Bthat will pay money depending on the color of the ballgreen or bluethat is chosen by a bingo cage.
This table is then shown and explained.
You will see ten decision rows. The number of blue (and green) balls varies by decision row. For each row you must choose between OPTION A or OPTION B. In the first decision row there is 1 blue ball (and 9 green balls); in the second decision row, there are 2 blue balls and 8 green ones…and so on until the tenth decision row 10, in which there are 10 blue balls and 0 green ones. (Note that there will always be 10 balls; what changes is the mix of blue and green balls according to the decision row).
If this Activity is randomly selected for payment, we will throw a 10-sided die to choose a decision row and then we will draw a ball from the bingo cage to determine your payment, depending on the OPTION that you chose for that row.
Please observe Decision Row 1 (1 blue ball and 9 green balls).
OPTION A pays Q55 if the blue ball comes out; or pays Q45 if one (out of 9) of the green balls comes out.
OPTION B pays Q145 if the blue ball comes out; or pays Q0 if one (out of 9) of the green balls comes out.
Note that the probability of drawing a blue ball in this row is 10% (1 blue ball out of 10); the probability of drawing a green ball in this row is 90% (9 green balls out of 10).
As you move down the decision sheet the number of blue balls increases (and the number of green balls decreases). That is, the probability that the payment is defined by the blue ball (the higher payment) increases for both options.
In fact, for the tenth decision row (the last row), there are only blue balls for both options. Therefore, the payment will, with certainty, be the one corresponding to a blue ball (100% probability). That is, for this row, you must choose between Q55 (OPTION A) or Q145 (OPTION B).
If Activity 6 is randomly chosen for payment, your earnings will be determined as follows: First we will roll a ten-sided die to choose the decision row that will determine your earnings. (Of course, each decision row has the same probability of being chosen). Then, we will put the number of blue and green balls which correspond with the chosen decision row into the bingo cage. We will draw a ball from the bingo cage and your earnings will be determined by the color of the chosen ball and the option that you selected in the decision row.
Here is an example. Suppose that your earnings are determined according to this Activity, and that the number rolled by the die is 7. This means that row 7 will determine your earnings and we will put 7 blue balls and 3 green balls in the bingo cage.
If the bingo cage selects a blue ball and for row 7 you chose OPTION A, your earnings would be Q55. If for decision row 7 you chose OPTION B, your earning would be Q145.
If the bingo cage selects a green ball and for row 7 you chose OPTION A, your earnings would be Q45. If for row 7 you chose OPTION B, your earning would be Q0. In the next screen you will see 10 decision rows and you will have to select the option you prefer for each row.