It was only a matter of time before pop-news outlets pounced on a biological explanation for the tidal wave of bad credit and risky decisions that has engulfed the U.S. this month: it was those dang men and their raging hormones!
The source of this meme is a just-published study in Evolution and Human Behavior in which ninety-eight young men—most of them Harvard students—were given $250 to either save or "invest" in a game of chance. The ones who took the most risk, the researchers found, were the ones with the highest levels of testosterone in their saliva. Risk-takers also had more masculine facial features, perhaps because square jaws and bigger cranial bones are thought to be a proxy for testosterone exposure during puberty.
I recently spoke to the lead co-authors of the paper, Coren Apicella of Harvard and Anna Dreber of Harvard and the Stockholm School of Economics, to ask about what sex hormones have to do with risk-taking in the first place, and whether skyrocketing testosterone really had an impact on world financial markets.
I've seen a bunch of headlines today and yesterday saying things like "Testosterone caused the financial crisis!" What, if any, connections would you draw here?
Apicella: Anna is the economist, so she could probably give you a little more insight on this market crisis, but I would say that's media spin on the results that we found. But Herbert and Coates, two British researchers, published a study in May and made some interesting findings: male London traders on the floor actually made higher profits on days that their testosterone levels were above their median for the week.
Dreber: In today's business environment, investment banks select for extremely risk-taking individuals. I'm sure that these men have higher testosterone levels. How much did this actually contribute to the crisis? We don't know yet how much risk-taking in general contributed, but the insurance company AIG has more than 100,000 employees, and it was basically brought down by this small group of traders in London who were taking excessive risk there. They probably didn't have a good model of uncertainty, so in fact they were taking all this risk without even realizing it. It's likely that the guys over there had more testosterone than the average man.
Why might testosterone regulate risk preferences?
Apicella: In a wide range of behaviors and traits, men show more variation than women. For instance, hunting is a risky sort of strategy—you might get the kill, but you might come up with nothing. But if you do get something, you'll get quite a few calories. So these high-risk strategies could yield larger returns in terms of reproduction for men—they could have higher fitness payoff. A woman's fitness is limited to her access to resources and how many children she can have in a lifetime. Men's fitness is limited only by their access to different women, and one way for them to attract different women is by having a lot of resources—that is, money.
You found that men who had testosterone levels one standard deviation above the mean invest $17 more than average in a risky investment. But is this necessarily a bad thing?
Dreber: It can make sense to take risks. For example, we find that some women take too little risk for their own good, including on the stock market. They might think that it makes more sense to look at the expected value of an investment than the variance. And in our study, the high testosterone men didn't take excessive risk . . . they took acceptable risk. But we could have designed a risk measure when it doesn't really make sense to take risks, and we are planning on doing that in a later study.
Your study didn't prove that high testosterone causes this kind of behavior, just that there's an association. Do you think that a causal relationship will eventually emerge?
Apicella: Absolutely. In a future study, we plan to look at how financial wins and losses affect men's testosterone levels, and how that in turn affects their confidence and future risk taking. It's called the "winner-loser" effect: when sports teams win, the testosterone levels of the players and even of their fans rise relative to those of the losers. So we want to look at these differences in testosterone level and see whether the actual change in testosterone [caused by winning] predicts future risk-taking behavior. This should give us a better of idea of what exactly is mediating the relationship between risk and testosterone. Do these men just have more confidence? Are they just realistic, getting things right more often? We're also working on a genetic association study—I can't get into the results too much, but there might be certain genotypes in both men and women related to financial risk-taking.
Welcome to The Sex Files. Almost every publication worth its druthers has a sex column these days, full of Carrie Bradshawish musings about life and love, men and women, this and that. Here's our take on the genre. Instead of faux-sociology, we'll give you a broad view of new research and ideas in the sexiest of the hard sciences: reproductive biology, evolutionary anthropology, and genetics. This is sex from the inside out. Keep track of the column at popsci.com/sexfiles, where you can also sign up for an rss feed.
from what i have read and seen, YES!!! this is so true, Sorry guys :)
"from what i have read and seen, YES!!! this is so true, Sorry guys"
Try again sweetie. Saying that taking risks caused the financial meltdown is stupid and naively oversimplifies what happened.
The risk-taking part is definitly accurate. However, in the stock market, you must take risks. Some of those risks pay off. Some end in ruin. A smart risking taker can actually decrease risk and increase reward through proper balance.
(By the way, now is a great time to make money. If you are out of debt, and if you have some money to invest, then buy a huge variety and quantity of stocks. Some will fail, and some will survive. Eventually, the economy will go back up and you can generate a massive amount of wealth.)
I had no clue that pop sci hired such sexists. You do realize that if you said 'blame women' you would get lynched. This is really pathetic, everyone is at fault!!!
You do realize that *every* facet of the human experience (risk or caution, decision or indecision, tendency or impartiality) can be pegged to a chemical if you embrace such deterministic view of psychology, right? Saying "testosterone" caused a particular hooplah is only slightly more enlightened than saying estrogen caused original sin.
Sure, you can make an argument that testosterone fueled the financial crisis. But you can also make an argument that testosterone fueled the existence of financial markets in the first place.
"If civilization had been left in female hands, we would still be living in grass huts." -- Camille Paglia, Sexual Personae.
Dustin H.--I have no idea whether PopSci hires sexists or not, but the headline here is completely tongue-in-cheek. If a study had found that estrogen fuels financial risk-taking, the editor in charge would've slapped "Blame Women!" onto that hed in the time it takes to say "Mary Daly."
Dontbother--Your point is well-taken--and I hope it was clear that I was looking askance at such simplistic formulations, not endorsing them--but that doesn't mean it's not interesting to pin down the effect that one specific hormone might have on one specific (but extremely important) behavior: taking risks with assets and resources. I hope that studying these things will actually lead us to a richer view of human motivations, not a more starkly deterministic one.
AndrewB--That's one thing that the authors of this study--particularly Anna Dreber, the economist--are interested in looking at next: how male hormones might have had a part in the impulse to create financial markets, why more men are traders, how testosterone is connected to profitability, etc.
And BTW, I like Camille Paglia as much as the next sex blogger, but she's a provocateur first, a scientist second (hey wait--she's not a scientist at all!).
To everyone--thanks for reading. In the future, I'll try to respond to as many comments as I can, so if you have any more questions, requests, nagging concerns, or accusations of sexism for me, drop 'em here!
In this article it says that women have been found to take too little risk and that only men with abnormally high testosterone levels take excessive risks so I am confused why the title says blame men. You should blame women and abnormal men. This article appears to be saying that normal men are the best for making financial.
Mind boggling. A story bad mouthing men through naive research and oversimplification. Surprise surprise its written by two women. Did they do a proper study and include women in it? No. They clearly had a premise (men are bad and are ruining this world) and did research to prove that faulty premise. This article is basically a sexist agreement of their bad research, and oh my god, its written by a female. If this story was about the other gender, you can bet womens rights groups would be banging on pop-sci's proverbial door. Its disgusting how far the pendulum has swung to the opposite side.
They touch on the real truth in the article. Actually it should be "Blame Women" because, to simplify it, men take risks to impress women.
Your article brings up an interesting concept - linking global financial crisis to basic human chemistry. However I see things the other way around. Personally, I think that the high testosterone levels are the result, not the cause, of the high risk. I hate to generalize too much, but let me explain:
In our non-hunter/gatherer society, men have very little aggression release aside from sports. It is common knowledge that testosterone increases in the body when risk is taken (whether physical risk or other), or the perception of such risk is taken. That's why guys can sit for hours watching teams of men bash each other for a leather sack: they feel good and "manly" doing it. It's slightly different, but the risk involved in the stock market is comparable. So I see the correlation, Julia, but I see it the other way around. The risk brings the hormones, not the other way around (as much).
To respond to all the men-defenders - I didn't see Julia Wallace attacking men - just bringing up a correlation.
Mifdeath, in your critique I believe the YOU oversimplified her article - practice what you preach, man.
pretending that this is baseless sexism utterly ignores evidence & fact.
Take a good look in the male & female prisons.
Notice that assault is a very common cause of landing in a male prison.
Notice that it isn't so common a cause of landing in female prison.
Ignoring that we are, in some sense, 2 complimentary races, each with our own way, for political reasons, isn't intelligent, objective, or even useful.
Consider the likelyhood of a child being assaulted by a man vs a woman...
Significantly more likely that it be a man?
Notice how our western history proves we guys committed aggression against ALL women by preventing 'em from having human rights, by law?
I don't claim women don't commit abuse of others, but it's a different kind of abuse ( see the recent research where mothers use "low opinion" of their daughters to snuff out their potential ).
I don't see why we can't be "man enough" to admit objective facts.
I'd have to say that both men and women have weaknesses, so let's not hear any of this "better gender" argument crap from the days of Elementary School. The world is going to hell because of humans in general, not because of men or women in particular. Let's look at why this is.
Humans are naturally more curious than most other animals, so we look to discover things, which leads to invention. Inventions are, for the most part, created to make tasks easier, but because we want things faster and cheaper AND we have this underlaying instinct of survival, we end up doing things such as becoming overly dependent on fossil fuels and refusing to change to anything different, despite the obvious path of self destruction because we need oil to drive to work which in turn gets us food etc.
It's pretty immature to point one's finger at anyone in particular when we're all guilty of everything crumbling. We all contribute. Sorry if I'm coming across harsh but it's just the truth.
I'm not saying every one is bad either. There are plenty of good people out there.
This is an interesting study though, and I can see where the researchers etc. are coming from. Men tend to be aggressive/impulsive. It's natural. However, the pop-media blowing this one out of the water and trying to blame men? The stock crashed because we can't make things perfectly. We are imperfect beings living in an imperfect world. So what do we usually do when our inventions fail? We point the finger at select group or one person in particular to make ourselves feel better.
P.S. (sorry for writing so much guys XD I like to write >.< )
I agree with Julia on the fact that this is a well-worth study and there's nothing wrong with looking into the cause of something. In my comment above, when I said people like to put the blame on others, I was referring to those who are sexist and the pop-media who suggested the idea that it was ONLY mens' faults that the market practically imploded.
So before I get incinerated by flamers,
I AM NOT SEXIST!! :D