Neurotic people don't actually care more about being safe—they just have a really hard time making up their minds.
March 25, 2026
Original Paper
Neuroticism and Risk Aversion: An Affect-Driven Account of Ambiguity Sensitivity and Choice Inconsistency
SSRN · 6449958
The Takeaway
Economists usually assume that personality traits like neuroticism lead to stable risk aversion. This study found that neurotic individuals don't have a consistent preference for being cautious; instead, they are simply highly inconsistent, making erratic and noisy decisions because their temporary emotions override any stable logic for safety.
From the abstract
<p><span>Do neurotic people avoid financial risk because they have stable cautious preferences, or because their emotional state at each decision moment drives them toward safety? This paper argues for the latter, and provides direct evidence. Using an individual-level survey experiment (N = 157) and cross-national secondary data (39 countries), we examine how and when Neuroticism shapes risk decisions.</span></p> <p><span>The central finding is that Neuroticism predicts choice inconsistency rat