October 21st, 2008
04:38 PM ET

Are men to blame for our economic crisis?

[cnn-photo-caption image=http://i2.cdn.turner.com/cnn/2008/images/10/21/art.nyse2.1021.jpg
caption="New York Stock Exchange today"]
Shahreen Abedin
Sr. Producer, CNN Medical News Unit

In my house, my husband pays the bills and I am usually the one who’s spending the dough. But when it comes to making investments, we usually put our heads together and try to figure out the smartest way to make the "Benjamins" multiply. It’s a system that works for us, and based on a new Harvard study, we’re probably saving ourselves from the riskier investments that we could be making were my husband to be the unilateral decision-maker on how to make our money grow.

The small study of 98 men found that those who had the highest amounts of testosterone in their systems than the group average were likely to invest 10% more money than the average. Basically, the researchers used saliva samples to gauge testosterone levels beforehand, and then they gave participants the opportunity to invest as much of their money as they wanted on a coin toss. They could gain a 250% return on their investment if they won, or lose the entire investment if they lost the toss.

So the researchers conclude that financial decision-making and risk-taking aren't necessarily based entirely on rational thinking; some of it is just something men naturally tend to do, even driving them to make irrational decisions, which may lead to lower profits, and possibly could explain why the stock market is in the doldrums these days.

The reason for such unreasonable behavior: men have an innate evolutionary drive to take risks in order to gain more resources (money!) than other men, which would in turn make them more attractive mates than others. Yeah, it’s all about competition and reproduction, explains Harvard anthropologist Coren Apicella. So whether it's impetuous trading on the stock exchange floor, or hastily entering an imprudent mortgage loan - it's possible that being a man can work against you.

So does that mean that I should be more in charge of deciding where our funds go to grow instead of doing it fifty-fifty? Well, not necessarily. Women don’t have as much testosterone in their systems. So they tend to be more risk-averse, and you might think that means women are more likely to make even-keeled decisions when it comes to money.

On the flip side, however, another recent study found that male stock market traders made greater profits when they had higher levels of testosterone in their systems. So you could argue that men are more successful money-makers because they do tend to take greater risks compared to people who are less “ballsy”.

So what do you think? Are men to blame for the current financial crisis because they’ve been too aggressive with our money? Would women do a better job if they took the reins instead? Do you think financial risk-taking is in part due to a biological imperative, or more just about personality, environmental conditioning, or something else?

Filed under: 360° Radar • Economy
soundoff (15 Responses)
  1. Jashon

    I would blame our corporate run government that caters to nothing but greed, but that is too easy. I blame mindless consumerism by MEN and WOMEN. America and its masses of drones buying useless products to kill time in between now and death. Buying products with money they don't have. Banks endlessly extending credit to idiots who see something shiny and have to have it right away.

    When one lives their life only for the moment is it a surprise that they reach a swift demise?

    What will happen for this young, immature nation who's entire history revolves around living for the moment?

    October 21, 2008 at 9:55 pm |
  2. Dr. Dean

    Brenda Harris is dead wrong. Many middle class Americans benefited from the run up in stock prices that also benefited many wealthy Americans. 401K accounts and retirement funds rose with the stock market making many Americans a lot of money. Had Fannie Mae and Freddie Mac not been risking so much money on stupidly bad loans those 401Ks and retirement funds would not have lost 25% or more over the past few months. WIth fewer stupid loans – which Barney Frank and Chris Dodd knew full well about – our nation would not be facing a recession.

    October 21, 2008 at 7:02 pm |
  3. Betty Ann, Nacogdoches,TX

    Men and women~Rubublicans!

    October 21, 2008 at 6:53 pm |
  4. Jeff

    I have to put a lot of blame on 1 man, A lot of tthis was brought upon us by ST Ron and his trickle down economics. .Has anything trickled past the Executive Boardrooms of any corporation.

    October 21, 2008 at 6:48 pm |
  5. matt

    Well, thank good i'm not to blame for my decisions! It's my hormones! Seriously? that's like saying if women ruled the world there wouldn't be war...and anyone who knows their history can tell you that's not true. Men also give flowers more often than women do, too. Is that just hormone's too, or are men more romantic? Ultimately, these statements and questions are both over-generalized and devisive. How does this article contribute anything to our greater undertsanding of the world? I'm so sick of hearing about the war of the sexes...it's so overdone and cliche at this point.

    October 21, 2008 at 6:35 pm |
  6. Dana Durant

    Yes, I believe men who are bent on making greed come first are responsible for this mess in our economy. Bush especially!

    Thank you, Dana

    October 21, 2008 at 6:23 pm |
  7. Chad

    Yes, men are to blame. And they wear both red and blue coats. Much needs to be done to investigate very thoroughly both sides of the government.(Dem. and Rep.) Another story that isn't being covered well on many networks is Joe Biden's latest gaffe from this weekend – saying that if Obama is elected there will be a major incident (possibly terrorism) from Al Queda, Russia, etc. He also said that he has forgotten much about foreign policy. I have heard these clips on other networks for days. My favorite CNN shows are Situation Room and AC 360 – Why won't they cover this story. I want to hear it from a fair CNN perspective.

    October 21, 2008 at 6:11 pm |
  8. Heather,ca

    If you are talking about the financial mess that we are in then I would have to say yes men in this specific situation are to blame. If you want to apply medical science fine. I know more men who are in the business on Wall Street. I can't imagine a women approving of a ponzi scheme or wanting to break the law. From the male CEO's of all these companies to the men on the NYSE trade floor there are more men than women. Ok I know the next comment would be more women are needed in the business. Or if more women were in the business this ponzi scheme would not have happened. I dont know. To answer your question in a matter of fact technical way, yes men are to blame. However there are plenty of men who know right from wrong who would rather trade stock in a legal way than break the law. I wont make a sweeping generilaztion about men because it isnt fair. I think greed is greed. There are women who are just as greedy as men. I think it all comes down personality and how you are brought up. What you value. Knowing you have a very important responsibility to invest a client's money in a legal ethical way.

    October 21, 2008 at 6:07 pm |
  9. Sophie MN

    I'm unhappy to report that my husband and I are equally as financially clueless at times. It's not a gender thing, it's a learned skill.

    October 21, 2008 at 5:53 pm |
  10. Annie Kate

    I don't think being a man or a woman is related to this mess – however hubris and greed are very related. 2 of the 7 deadly sins....got us again!

    Annie Kate
    Birmingham AL

    October 21, 2008 at 5:50 pm |
  11. Pat Costlow

    Ignorance ,not just men or women are to blame for the economic crisis. If we could have seen it coming, we would have fixed it.
    The daily grind to survive has made America ignorant about so many
    things that are going on and too tired after a hard days work to care until it was too late. Harsh but true.

    October 21, 2008 at 5:15 pm |
  12. Melissa, Los Angeles

    Oh please. Both men and women are to blame. The majority of Americans are spenders and not savers. How many of us have over $5,000 or more in credit card debt? How many of us have more than 10 credit cards all put to use?

    October 21, 2008 at 5:05 pm |
  13. Brenda Harris

    Is this a plug for Sarah Palin?
    Republican people you have all got to come to your senses. You have got to know that the financial crisis was due to the rich getting richer robbing the poor and giving to the rich. Did you see the special on CNN about the Fat Cats and how they spend money that could have gone for Jobs and healthcare and housing. They don't care that we are struggling. And how about sending our youth off to die. How can you trust them again? Do you want to stand on a corner and beg for food. You can't afford to vote for more of the same.

    October 21, 2008 at 4:52 pm |
  14. Bobby T-Bone

    For once give out polls#s other than a liberal bias poll like a CNN poll,at least Fox news gives out Russusen and Zolby polls,you guys give noting but a CC poll

    October 21, 2008 at 4:52 pm |
  15. karen

    Yes, starting with an investigation on Fannie and Freddie.
    Chris Dodd and the rest. Where are their hands in all this ???
    Why don't you do some investigating.

    October 21, 2008 at 4:46 pm |

Post a comment

You must be logged in to post a comment.