The Durk Pearson & Sandy Shaw®
Life Extension NewsTM
Volume 19 No. 3 • April 2016


RISKY CHOICES:
AN ECONOMIC PERSPECTIVE

In economics, the difference between the preference for a small but certain reward (risk-averse) and preference for a larger but uncertain reward (risk-seeking) is an area of intensive study. (See, for example, MacKillop, 2013) Now, economists have extended the reach of their investigations to look at genetic and neurological correlates for these preferences, a new economic/scientific field called Behavioral Economics. As the author of a recent paper (MacKillop, 2013) says, “[t]here is growing interest in genetic influences on discounting and, in particular, the prospect of discounting as an endophenotype for addictive disorders...” Discounting is the way one adjusts his present valuation of a future reward based on the risk inherent in a delayed reward. It is the reason that you charge INTEREST when you loan money—the money is more valuable in your hands TODAY than the hypothetical possession of it sometime in the future. Delayed reward discounting is defined in one paper (MacKillop, 2013) as “how much a reward loses value based on its distance in the future.” This is also the Austrian School of Economics’ concept of time preference.

The term “endophenotype” simply means the expression of a particular genetic trait, in this case the preference for risk-aversion or risk-seeking. The DRD2 gene has been strongly supported as being involved in this preference (Zalocusky, 2016), with low levels of DRD2 activity associated in humans with risk-seeking behavior. The low levels of DRD2 can lead to addictive behaviors as individuals seek to increase dopamine release in the brain’s reward circuitry by engaging in these behaviors.

The researcher (MacKillop, 2013) thinks of the risk-seeking phenotype as “impulsive discounting.” He states his hypothesis: “...although not definitive, there is accumulating support for the hypothesis of impulsive discounting as an endophenotype for addictive behavior and a need for further systematic investigation.”

An early study of “impulsive discounting” was the famous marshmallow tests, where children had to decide whether to consume a second marshmallow (after eating one) or wait to receive yet another marshmallow. The children who waited were in later life seen to have higher educational and other life achievements; this trait continued for decades. Those who did not wait were more likely to misuse drugs at older ages.

References

  • MacKillop. Integrating behavioral economics and behavioral genetics: delayed reward discounting as an endophenotype for addictive disorders. J Exp Anal Behav. 99(1):1-25 (Jan. 2013).
  • Zalocusky. Nucleus accumbens D2R cells signal prior outcomes and control risky decision-making. Nature. doi:10.1038/nature17400 (2016).

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