PhD Defence Marco Meyer 'Economic Consequences of Personality, Knowledge, and Intellectual Virtues'

The overarching research question of the thesis is whether and to what extent individual characteristics affect economic decision making. We investigate how personality influences economic decision making, with a lab-in-the-field experiment as well as observational data from rural Kenya. We find that particular personality profiles are associated with the risk propensity of farmers, their investment decisions, their desire for credit, and the amount of formal and informal credit they obtain. We study the relationship between mortgage literacy and mortgage risks with a newly designed Mortgage Literacy Questionnaire using Dutch household data. The Mortgage Literacy Questionnaire evaluates the domain-specific knowledge of households about mortgages, including the legal and fiscal implications of different types of mortgages. We find that mortgage literacy is associated with lower perceived mortgage risk, and with how well households hedge mortgage risk. We develop and validate the Intellectual Virtue Scale, a new measure of intellectual virtues. Intellectual virtues are acquired character traits that support gaining knowledge and understanding. We develop a 20-item scale, measuring five intellectual virtues with four items each: love of knowledge, openness in gathering information, conscientiousness in processing information, humility in belief formation, and intellectual courage. We study the relationship between the Intellectual Virtue Scale and financial knowledge and diligent financial decision making. We find that intellectually virtuous people are more financially literate, display greater self-awareness about their financial knowledge, and are more likely to compare financial advisors.