The Promises and Pitfalls of Genoeconomics

Abstract

This article reviews existing research at the intersection of genetics and economics, presents some new findings that illustrate the state of genoeconomics research, and surveys the prospects of this emerging field. Twin studies suggest that economic outcomes and preferences, once corrected for measurement error, appear to be about as heritable as many medical conditions and personality traits. Consistent with this pattern, we present new evidence on the heritability of permanent income and wealth. Turning to genetic association studies, we survey the main ways that the direct measurement of genetic variation across individuals is likely to contribute to economics, and we outline the challenges that have slowed progress in making these contributions. The most urgent problem facing researchers in this field is that most existing efforts to find associations between genetic variation and economic behavior are based on samples that are too small to ensure adequate statistical power. This has led to many false positives in the literature. We suggest a number of possible strategies to improve and remedy this problem: (a) pooling data sets, (b) using statistical techniques that exploit the greater information content of many genes considered jointly, and (c) focusing on economically relevant traits that are most proximate to known biological mechanisms.

Pre-Birth Factors, Post-Birth Factors, and Voting: Evidence from Swedish Adoption Data

“…Researchers studying gene-by-environment (G E) interactions must wrestle with a number of conceptual and de…nitional questions (Benjamin et al 2012b;Chow and Lee 2012) and empirical challenges (Conley 2009). In molecular genetic work, a major challenge is that most genetic e¤ects on complex outcomes, including political variables, are likely to be of tiny magnitude (Benjamin et al 2012a, b).…”

The genetic architecture of economic and political preferences

“…This enthusiasm is based on a number of potential contributions that such research could make to social science (1)(2)(3). For example, if specific genetic markers can be identified that are associated with a behavioral trait, then such predictive markers may shed light on the biological pathways underlying that trait (3,4).…”

Biology and Gender in the Labor Market

“…Parents, for example, are likely to modify the environment in response to their children's genetic endowments. This implies that estimates from behavioral genetics models are difficult to interpret because they are essentially reduced-form estimates from a more general model in which environmental influences are endogenous with respect to genotype (see Beauchamp et al 2011, Benjamin et al 2012 for a discussion). Using such estimates for policy development requires a great deal of caution.…”

“…Benjamin et al (2008) coined the phrase "genoeconomics" to refer to the use of molecular genetic information in economics. Two primary research strategies are being used to identify the link between genes and behavior: i) candidate gene studies in which an "educated guess" is used to select particular genes for analysis because of their known biological functions; and ii) genome-wide association studies (GWAS) in which researchers look for associations between the outcome of interest and millions of possible genetic variations across the human genome (see Benjamin et al 2012). …”

“…Results have been remarkably difficult to replicate, leading some to suggest that many findings are spurious (Beauchamp et al 2011). Most studies are seriously underpowered because sample sizes are too small, and although much of the promise of geneconomics lies in uncovering the causal mechanisms behind biological processes, the evidence thus far is strictly correlational (Beauchamp et al 2011, Benjamin et al 2012, Chabris et al 2015. Moreover, research has not yet explicitly investigated whether heredity and genetic variation operates differently for men and women -and whether this is an important source of gender disparities.…”