Document Type
Working Paper
Date of this Version
5-1-2016
Abstract
Around the world, average life expectancy is increasing. Adults of all ages face important decisions that affect their life outcomes and overall well-being. This paper reviews recent developments in research on age differences in decision-making competence. The measurement of age differences in decision-making competence is grounded in normative theories of decision making, which posit how people should be making decisions, as well as descriptive research, which aims to examine how people actually make decisions. Studies on age differences in decision making have shown mixed patterns of results, perhaps because of having included a wide range of decision-making competence tasks. Each decision task may rely on a different combination of skills, with some showing age-related declines and others showing no change or improvements with age. Here, I discuss the potential skills that may contribute to making good decisions, including cognitive deliberation, experience, emotions, and motivation. Although fluid cognitive abilities that underlie cognitive deliberation are known to decline with age, the others show different developments with age. I also discuss potential interventions that aim to target cognitive deliberation, experience, emotions, and motivation, so as to promote better decisions and associated life outcomes across the life span.
Keywords
Aging, decision making, interventions
Working Paper Number
WP2016-11
Copyright/Permission Statement
All findings, interpretations, and conclusions of this paper represent the views of the author(s) and not those of the Wharton School or the Pension Research Council. © 2016 Pension Research Council of the Wharton School of the University of Pennsylvania. All rights reserved.
Acknowledgements
Funding was received from the European Union Seventh Framework Programme (FP7-People-2013-CIG-618522; PI: Bruine de Bruin). My research on aging and decision-making competence has benefited greatly from collaborations with Baruch Fischhoff, Fabio Del Missier, Andrew M. Parker, JoNell Strough, and others.
Date Posted: 06 March 2019
Comments
The published version of this Working Paper may be found in the 2017 publication: Financial Decision Making and Retirement Security in an Aging World.