Leadership

Aging And Decision Making: How Aging Affects Decisions Under Uncertainty

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Executive Summary

In an aging society, it becomes more and more important to understand how aging affects decision making. Older adults have to face many situations that require consequential financial decisions. In this paper, the authors examined the effects of aging on decisions in two domains of uncertainty: risk and ambiguity. For this purpose, a group of young and older adults played a card game which was composed of risky and ambiguous conditions. In the risk condition, participants knew the probabilities to win or lose the game (i.e. full information), whereas in the ambiguous condition, these probabilities were unknown (thus, there was lack of information).

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