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Success may be “family affair”

Nov. 29, 2006
Courtesy University of Bonn
and World Science staff

A study has led re­search­ers to spec­u­late that career suc­cess may be part­ly ge­ne­tic.

The sup­po­si­tion rests in part­i­cu­lar on two new find­ings, the in­ves­ti­ga­tors said: that will­ing­ness both to take risks and to trust fel­low hu­mans seem in­her­it­ed. Since as­tute judg­ment in both are­nas are cru­cial to suc­cess in busi­ness and a range of oth­er fields, that it­self might be he­red­i­tary, they rea­soned.
The re­search­ers ad­mit­ted that cir­cum­stances al­so give rich kids a leg up, but ar­gued that genes con­t­ri­bute.

The study by the In­sti­tute for the Study of La­bor and the Uni­ver­si­ty of Bonn, both in Bonn, Ger­ma­ny, was pub­lished on­line as part of “dis­cus­sion pa­per” se­ries on the in­sti­tute’s web­site.

The re­search­ers used da­ta from a sur­vey of 3,600 Ger­man par­ents and their chil­dren. On av­er­age the chil­dren were 25 years old; more than 40 per­cent were no long­er liv­ing with their par­ents.

In “will­ing­ness to take risks, chil­dren are as­ton­ish­ing­ly si­m­i­lar to their par­ents,” said Uni­ver­si­ty of Bonn econ­o­mist Ar­min Falk. “This is not on­ly true for the over­all es­ti­mate, but al­so for the dif­fer­ent cat­e­gories. There are peo­ple, for ex­am­ple, for whom no [slope] is too steep when ski­ing, but who in­vest their mon­ey in se­cure gov­ern­ment bonds. An iden­ti­cal risk pro­file can of­ten be found with their chil­dren.”

Things are si­m­i­lar with the will­ing­ness to trust, he added. “Of course our re­sults are based on a sur­vey,” said Falk. “How­ev­er, our ex­per­i­ments over the last few years have shown that self-assessment is very con­sist­ent with ac­tu­al char­ac­ter traits.”

Genes that influence risk-taking have been re­port­ed in mice. In the Oct. 11, 2005 is­sue of Pro­ceed­ings of the Na­tio­n­al Aca­de­my of Sci­en­ces, sci­en­tists de­scribed find­ing such a gene, called neu­roD2.

Falk’s sur­vey al­so found that wom­en and their hus­bands al­so tend to have si­m­i­lar at­ti­tudes on trust and risk-tak­ing. 

“Every eco­nom­ic de­ci­sion is risky, wheth­er it is about buy­ing shares, build­ing a house or just start­ing to study at uni­ver­si­ty,” Falk said. “On the oth­er hand suc­cess in busi­ness al­so in­volves the right amount of trust.”

“If chil­dren are si­m­i­lar to their par­ents in their will­ing­ness to take risks and trust oth­ers, they will of­ten make si­m­i­lar de­ci­sions in eco­nom­ic sit­u­a­tions, too,” Falk con­ti­nued. “Of course peo­ple who come from a rich fam­i­ly simp­ly have bet­ter chances in life.” 

Zu­rich econ­o­mist Ernst Fehr re­cent­ly com­pared the will­ing­ness to take risks among Amer­i­cans and Ger­mans, us­ing the same set of ques­tions. U.S. in­ter­vie­wees scored an av­er­age of 5.6, where­as Ger­mans scored 4.4, no­tice­ably more cau­tious, Falk said.

“The U.S.A. is tra­di­tion­ally a coun­try of im­mi­gra­tion,” he ob­served. “Prob­a­bly it is particularly peo­ple who are prone to take risks that tend to em­i­grate; at least there is re­search point­ing in this di­rec­tion. Our re­sults add to this, show­ing that the will­ing­ness to take risks is some­how ‘in­her­it­ed.’ This may ex­plain the dif­fer­ence.”

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A study has led researchers to speculate that success may be in the genes. The supposition rests on two basic findings, the investigators said: that willingness both to take risks and to trust fellow humans seem to be inherited. Since astute judgment in both arenas are crucial to success in business and a range of other fields, that itself might be hereditary. The researchers admitted that circumstances also give rich kids a leg up, but argued that their genes help too. The study by the Institute for the Study of Labor and the University of Bonn, both in Bonn, Germany, was published online as part of “discussion paper” series on the institute’s website. The researchers used data from a survey of 3,600 German parents and their children. On average the children were 25 years old; more than 40 percent were no longer living with their parents. In “willingness to take risks, children are astonishingly similar to their parents,” said University of Bonn economist Armin Falk. “This is not only true for the overall estimate, but also for the different categories. There are people, for example, for whom no [slope] is too steep when skiing, but who invest their money in secure government bonds. An identical risk profile can often be found with their children.” Things are similar with the willingless to trust one’s fellow human beings, he added. “Of course our results are based on a survey,” said Falk.” However, our experiments over the last few years have shown that self-assessment is very consistent with actual character traits.” Genes that may control risk-taking have been identified in mice. In findings published in the Oct. 11, 2005 issue of pnas, scientists reported finding a gene of this nature, called neuroD2. Falk’s survey also found that women and their husbands also tend to have similar attitudes on these questions. “Every economic decision is risky, whether it is about buying shares, building a house or just starting to study at university,” Falk said. “On the other hand success in business also involves the right amount of trust.” “If children are similar to their parents in their willingness to take risks and trust others, they will often make similar decisions in economic situations, too,” Professor Falk said. “Of course people who come from a rich family simply have better chances in life,” he added. Zurich economist Ernst Fehr recently compared the willingness to take risks among Americans and Germans, using the same set of questions. The interviewees on the other side of the pond scored an average of 5.6, whereas Germans, who scored 4.4, are noticeably more cautious, Falk said. “The USA is traditionally a country of immigration,” Falk said. “Probably it is particularly people who are prone to take risks that tend to emigrate; at least there is research pointing in this direction. Our results add to this, showing that the willingness to take risks is somehow ‘inherited.’ This may explain the difference.”