We measure financial literacy among LinkedIn members, complementing standard questions with additional questions that allow us to gauge self-perceptions of financial literacy.Average financial literacy is surprisingly low given the demographics of our sample: fewer than two-thirds of CFOs, CEOs, and COOs complete the test correctly.Financial literacy, precautionary savings and retirement planning are positively correlated, but this is mostly driven by perceived, not actual, literacy: controlling for self-perceptions, actual literacy has low predictive power.Perceptions drive decision-making among low-literacy respondents and are associated with mistaken beliefs about financial products and less willingness to accept financial advice.

Studies have found that a variety of drug-dependent groups discount delayed rewards more than matched controls. This study compared delay discounting for a hypothetical $1,000 reward among dependent marijuana users, former dependent marijuana users, and matched controls. Discounting of marijuana was also assessed in the currently marijuana-dependent group. No significant differences in discounting were detected among the groups; however, currently dependent users showed a trend to discount money more than the other 2 groups. Within the dependent marijuana group, marijuana was discounted more than money, and discounting for money and marijuana was significantly and positively correlated. Regression analyses indicated that delay discounting was more closely associated with tobacco use than marijuana use. A variety of questionnaires were also administered, including impulsivity questionnaires. Dependent marijuana users scored as significantly more impulsive on the Impulsiveness subscale of the Eysenck Impulsiveness-Venturesomeness-Empathy questionnaire than controls. However, the 3 groups did not significantly differ on several other personality questionnaires, including the Barratt Impulsivity Scale-11. The Stanford Time Perception Inventory Present-Fatalistic subscale was positively correlated with money and marijuana discounting, indicating that a greater sense of powerlessness over the future is related to greater delay discounting. Results suggest that current marijuana dependence may be associated with a trend toward increased delay discounting, but this effect size appears to be smaller for marijuana than for previously examined drugs.

Delay discounting was examined in light smokers (10 or fewer cigarettes per day) and compared with previously published delay discounting data for heavy and never smokers. Participants evaluated several hypothetical outcomes: money gains and loses ($10, $100, and $1,000), health gains and losses (durations of improved and impoverished health subjectively equivalent to $1,000), cigarette gains and losses (amounts subjectively equivalent to $1,000), and potentially real rewards ($10 and $100). Light smokers discounted money significantly more than never smokers, but light smokers did not differ from heavy smokers. The 3 groups did not statistically differ in discounting of health consequences. Similarly, the 2 smoking groups were not found to differ in discounting of cigarettes. Like heavy smokers, light smokers discounted cigarettes significantly more than money and health. Several significant, positive correlations were found between smoking rate and various discounting measures in the heavy smokers but not in the light smokers. Several previous findings were replicated, helping to validate the present results: the sign effect (greater discounting of gains than losses), the magnitude effect (greater discounting of smaller rewards), reliability of discounting measures over time, and the consistency of hypothetical and potentially real rewards. These data suggest that even moderate levels of drug use may be associated with high delay discounting levels.

Many state lotteries offer players a choice between receiving roughly half of the jackpot immediately and receiving the entire jackpot over 25 annual payments. This requires players to make a decision that involves uncertainty, delay, and large amounts of real money. Archival data on lottery players’ jackpot payment decisions were collected from seven state and three multistate lotteries. Players’ jackpot payment preferences were assessed at the time of ticket purchase and after winning a jackpot. Preference for the annuity payment option significantly decreased as jackpot size increased, both at the time of ticket purchase and after winning. Furthermore, a significant proportion of winners who selected the annuity payment option at ticket purchase switched to the cash payment option after winning, whereas no winners switched from the cash to the annuity option after winning. These findings suggest that real-world choices involving large sums of money may be subject to diminishing marginal utility and probability and delay discounting.

Each of four pigeons was exposed to a single random-ratio schedule of reinforcement in which the probability of reinforcement for a peck on either of two keys was 1/25. Reinforcer amounts were determined by an iterated prisoner’s dilemma (IPD) matrix in which the “other player” (a computer) played tit-for-tat . One key served as the cooperation (C) key; the other served as the defection (D) key. If a peck was scheduled to be reinforced and the D-key was pecked, the immediate reinforcer of that peck was always higher than it would have been had the C-key been pecked. However, if the C-key was pecked and the following peck was scheduled to be reinforced, reinforcement amount for pecks on either key were higher than they would have been if the previous peck had been on the D-key. Although immediate reinforcement was always higher for D-pecks, the overall reinforcement rate increased linearly with the proportion of C-pecks. C-pecks thus constituted a form of self-control. All the pigeons initially defected with this procedure. However, when feedback signals were introduced that indicated which key had last been pecked, cooperation (relative rate of C-pecks)—hence, self-control—increased for all the pigeons.

Research has found that nicotine-dependent individuals delay discount monetary gains at a higher rate than matched controls. Delay discount rates, however, have also been found to vary across within-subject variables such as the magnitude of the outcome (e.g., 10 dollars or 1,000 dollars), whether the outcome constitutes a gain or a loss, and the commodity being evaluated (e.g., money or health). The present study comprehensively investigated the differences in delay discounting between current and never-before cigarette smokers and across these within-subject variables. Both groups exhibited a magnitude, sign, and commodity effect. Current smokers' delay discount rates for monetary outcomes, however, were higher than never-before smokers across all magnitudes and both signs. This trend was also found for delayed health outcomes, but failed to reach significance.

Pigeons played a repeated prisoner's dilemma game against a computer that reflected theirchoices: If a pigeon cooperated on trial n, the computer cooperated on trial n + 1; if the pigeon defected on trial n, the computer defected on trial n + 1. Cooperation thus maximized reinforcement in the long term, but defection was worth more on the current trial. Under these circumstances, pigeons normally defect. However, when a signal correlated with the pigeon's previous choice immediately followed each current trial choice, some pigeons learned to cooperate. Furthermore, cooperation was higher when trials were close together in time than when they were separated by long intertrial intervals.

The prisoner's dilemma is much studied in social psychology and decision-making because it models many real-world conflicts. In everyday terms, the choice to 'cooperate' (maximize reward for the group) or 'defect' (maximize reward for the individual) is often attributed to altruistic or selfish motives. Alternatively, behavior during a dilemma may be understood as a function of reinforcement and punishment. Human participants played a prisoner's-dilemma-type game (for points exchangeable for money) with a computer that employed either a teaching strategy (a probabilistic version of tit-for-tat), in which the computer reinforced or punished participants' cooperation or defection, or a learning strategy (a probabilistic version of Pavlov), in which the computer's responses were reinforced and punished by participants' cooperation and defection. Participants learned to cooperate against both computer strategies. However, in a second experiment which varied the context of the game, they learned to cooperate only against one or other strategy; participants did not learn to cooperate against tit-for-tat when they believed that they were playing against another person; participants did not learn to cooperate against Pavlov when the computer's cooperation probability was signaled by a spinner. The results are consistent with the notion that people are biased not only to cooperate or defect on individual social choices, but also to employ one or other strategy of interaction in a pattern across social choices.

Both social cooperation and self-control require reciprocation. In social cooperation situations a single person's cooperative act, if not reciprocated by others, would be unreinforced both immediately and in the long term. Similarly, a single act of self-control (refusing a single cigarette, for example), if not followed up by other such acts, would also be unreinforced immediately and in the long term. The present experiments varied probability of reciprocation in a prisoner's dilemma-like game that could resemble a social cooperation or a self-control situation. Participants earned points by playing against a computer. The computer offered the participant a choice between 5 or 6 points ('cooperation' by the computer) or between 1 or 2 points ('defection' by the computer). The participant's choice of the lesser alternative ('cooperation') or the greater alternative ('defection') on the current trial led, respectively, to cooperation or defection by the computer on the next trial with a probability (probability of reciprocation, PR) which could vary. When PR was greater than 63%, consistent cooperation maximized the participant's earnings. When PR was less than 63%, defection maximized earnings. Three conditions were studied: PR signaled by spinners; PR unsignaled; PR unsignaled with participants believing that they were playing with another person, not the computer. With PR = 100% ('tit-for-tat') and PR = 50%, the modal participant maximized earnings under all three conditions. With PR = 75%, participants maximized earnings only when PR was signaled. These results indicate that differences between people's tendency to cooperate with other people (social cooperation) and their tendency to cooperate with their own future interests (self-control) may lie in differences in subjective PR. Copyright © 2001 John Wiley & Sons, Ltd.