Saving Performance and Cognitive Abilities

Experiments on saving behavior reveal substantial heterogeneity of performance. We show that this heterogeneity is reliable and examine several potential sources of it, including cognitive ability and personality measures. The strongest predictors of performance are two cognitive ability measures. We conclude that complete explanations of heterogeneity in dynamic decision making requires attention to complexity and individual differences in cognitive constraints. First Draft: June 2005 This Draft: February 2006 JEL Classification Codes: C91, D91, E21.

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