Business & Society 

Sex hormones do not affect economic behavior


A new study published in the April 6 advanced online issue of the Proceedings of the National Academy of Sciences (PNAS), shows that neither testosterone nor estrogen had any effect on financial risk taking.
Neither had it no effect on other “economic behavior” (altruism, fairness concerns or trust).

It is well established that women are more reluctant to take financial risks than men are; women for instance are less prone to invest their retirement savings in the stock market. It has been argued that these differences are due to sex hormones. Particularly, testosterone has been thought to increase risk taking and estrogen has been thought to decrease risk taking.

To test the hypothesis that sex hormones affect economic behavior a team of researchers at the Stockholm School of Economics and Karolinska Institutet conducted a double-blind randomised clinical trial. In the study women in the ages 50-65 years were randomly allocated to treatment with, testosterone, estrogen, or placebo. After 4 weeks of treatment, the women participated in a series of economic experiments to measure financial risk taking, altruism, fairness concerns, and trust. But no difference in behavior between the groups was discovered.

“When told about the results most people, especially women, are relieved”, said lead author Niklas Zethraeus. “Many dislike the idea that their economic behavior could be determined biologically by their sex hormones, and from that perspective the results are comforting”, Zethraeus continued.

“There are numerous preconceived notions concerning behavioral differences between men and women. Specific causal relationships can, however, only be proven or disproven by serious scientific work. The insight provided by our study contributes to enhanced understanding of the impact of hormones on human behavior”, said Angelica Lindén Hirschberg at Karolinska Institutet.

“The study reinforces the importance of conducting carefully controlled randomized studies”, added Magnus Johannesson at Stockholm School of Economics. “Previous studies looking at correlations between sex hormones and economic behavior have indicated that sex hormones are important. But such correlative evidence does not prove that sex hormones affect economic behavior. It may just reflect that sex hormones vary together with some other factor that affects economic behavior.”

Another possibility is that the previous correlative results are due to publication bias; the tendency of scientific journals to only publish so called “positive results” (and decline publishing countervailing evidence). “Publication bias is probably the worst problem of scientific publishing today. We were lucky to have a serious editor”, Johannesson concluded.

Niklas Zethraeus, Ljiljana Kocoska-Maras, Tore Ellingsen, Bo von Schoultz, Angelica Lindén Hirschberg, Magnus Johannesson. A Randomized Trial of the Effect of Estrogen and Testosterone on Economic Behavior. PNAS 2009.

The research was funded by The Jan Wallander and Tom Hedelius Foundation, The Swedish Council for Working Life and Social Research, The Swedish Research Council, and the Karolinska Institutet.

For further information contact:
Professor Magnus Johannesson, Stockholm School of Economics, Stockholm, Sweden; tel: +46 8 7369443; e-mail:  

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