Abstract
It is well known that hormones affect both brain and behavior, but less is known about the extent to which hormones affect economic decision-making. Numerous studies demonstrate gender differences in attitudes to risk and loss in financial decision-making, often finding that women are more loss and risk averse than men. It is unclear what drives these effects and whether cyclically varying hormonal differences between men and women contribute to differences in economic preferences. We focus here on how economic rationality and preferences change as a function of menstrual cycle phase in women. We tested adherence to the Generalized Axiom of Revealed Preference (GARP), the standard test of economic rationality. If choices satisfy GARP then there exists a well-behaved utility function that the subject’s decisions maximize. We also examined whether risk attitudes and loss aversion change as a function of cycle phase. We found that, despite large fluctuations in hormone levels, women are as technically rational in their choice behavior as their male counterparts at all phases of the menstrual cycle. However, women are more likely to choose risky options that can lead to potential losses while ovulating; during ovulation women are less loss averse than men and therefore more economically rational than men in this regard. These findings may have market-level implications: ovulating women more effectively maximize expected value than do other groups.
Highlights
Estrogen and progesterone levels have been shown to affect behaviors beyond those related to reproductive function (e.g. [1,2])
The lack of research on risk and loss preference changes during ovulation may relate to the difficulty in determining the time of ovulation and in testing during the narrow window that ovulation provides. We address this difficulty by tracking subjects over several months and using ovulation predictor kits to measure the surge in luteinizing hormone that leads to ovulation
If subjects adhere to Generalized Axiom of Revealed Preference (GARP) in all four tested phases of the menstrual cycle, this means that women behave as if they are maximizing some quantity, essentially a utility function of some kind, regardless of menstrual cycle phase. This critical first observation allows us to proceed to a second test–how does the object of maximization, the utility function, change across the menstrual cycle? To this end, we examined the risk preferences of women by presenting them with choices between safe options of certain monetary gains and risky options with an equal chance of either $0 or larger potential gains, a domain in which humans are typically rational, albeit risk averse [21]
Summary
Estrogen and progesterone levels have been shown to affect behaviors beyond those related to reproductive function (e.g. [1,2]). Estrogen and progesterone levels have been shown to affect behaviors beyond those related to reproductive function A variety of behavioral changes have been demonstrated with varying levels of these hormones: cyclic modulation of mood [3], changes in cognitive abilities [4], subjective responses to drugs such as cocaine [5] and amphetamines [6], ratings of trustworthiness [7], and willingness to compete in tournaments [8]. Functional neuroimaging studies have shown that brain activity varies across the menstrual cycle. Changes have been observed in reward- and arousal-related activity [9,10] and responses to emotional stimuli [11]. Since changes in PLOS ONE | DOI:10.1371/journal.pone.0144080 January 29, 2016
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