The baking of preferences throughout the high school

Abstract

The purpose of this study is to examine whether girls and boys exhibit different risk and time preferences and how this difference evolves during the critical phase of adolescence. To achieve this, we use a large and powered sample of 4830 non-self-selected teenagers from 207 classes across 22 Spanish schools with very different socioeconomic backgrounds. Besides measuring time and risk preferences, we also collected classes's characteristics, social network measures, students' characteristics, and the average level of economic preferences of her or his friends. These measures enable us to account for potentially omitted variables that were not considered in other studies. The results indicate that there are no gender differences in time and risk preferences, but older subjects exhibit more sophisticated time preferences and greater risk aversion. We also performed an exploratory heterogeneity analysis, which unveils two important results. First, cognitive abilities play a critical role in the development of time and risk preferences, and second, interaction within the social network of the class also matters.