Stereotype threat affects financial decision making

Researchers investigated stereotype threat and its potential effects on loss aversion in two experiments. In the first study, student and employee participants (N = 53; 25 female, 28 male) completed mathematical, logical, and rational reasoning tasks that were either diagnostic of their intellectual ability (stereotype threat for women) or a puzzle-solving exercises (control). Moreover, participants indicated their gender prior to attempting the tasks in the stereotype threat condition but after completing the tasks in the control condition. Participants then completed a task involving financial risk to measure loss aversion. Women in the stereotype threat condition showed greater loss-aversion compared with men and women in the control condition. A subsequent study replicated the demonstration of greater loss aversion for women under stereotype threat and demonstrated, though use of a Stroop task, that a reduction in self-regulatory ability accounted for this effect. The results show that stereotype threat can affect various aspects of decision making by affecting self-regulatory resources.

Carr, P.B., & Steele, C.M. (2010). Stereotype threat affects financial decision making. Psychological Science, 21(10), 1411-1416.