Inconsistent choices among adolescents in El Salvador

Abstract

This paper examines inconsistencies in the decision-making of a sample of 3,000 adolescents from El Salvador when completing two classic experiments: temporal discounting and risk preferences. Inconsistency in responses is a significant issue when collecting experimental data because it implies a loss of the sample, as these data come from subjects who do not respond to the task as they ”should” and could indicate, for instance, a lack of understanding of the task. To mitigate this problem, we reduced the number of decisions, designed tasks with a strong visual component, and adapted them to the context with the assistance of a local pedagogical team.

Despite these experiments being specifically designed for them, we first observe the participants’ significant difficulties in avoiding errors such as multiple switching. Secondly, we investigate whether developmental factors influence consistency, specifically, whether inconsistency diminishes with age. Then, we analyze the role of cognitive skills (reflection, finance, and probabilities) and the student’s GPA in the consistency of their decisions in the experimental tasks. Next, using a subsample of a thousand subjects who repeated the same tasks nine months later, we investigate whether repetition improves consistency. Lastly, we explore whether this consistency in decision-making somehow shapes their long-term expectations.

 

Status: Working paper