Economic Preferences, Genes, and Childhood Disadvantage

Motivated by the Scarr–Rowe hypothesis—which suggests that the expression of genetic potential depends on early-life conditions—this paper investigates how a genetic predisposition toward success in education interacts with the childhood environment to shape economic preferences. Using incentivized experimental data from a representative sample of English adults over the age of 50, we find that a higher genetic propensity for educational success is associated with lower risk aversion and greater patience—but only among those who experienced more advantaged childhood environments. Among participants who experienced an adverse early-life environment, risk aversion increases with genetic resources, whereas the positive relationship between genetic resources and patience is significantly attenuated. These findings suggest that early-life conditions can channel genetic resources in ways that are contextually adaptive. Concurrently, the results indicate that environmental inequality shapes the realization of genetic potential in ways that reinforce patterns of social immobility, thereby intensifying concerns regarding the systematic underutilization of potential arising from constraints on household resources.