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Rank, stress, and risk: A conjecture

Author

Listed:
  • Stark, Oded
  • Wlodarczyk, Julia
Abstract
A perception at the core of studies that consider the link between social rank and stress (typically measured by the so-called stress hormone cortisol) is that the link is direct. Examples of such studies are Bartolomucci (2007), Beery and Kaufer (2015), and Koolhaas et al. (2017). A recent and stark representation of this body of work is a study by Smith-Osborne et al. (2023), who state that “social hierarchies directly influence stress status” (Smith-Osborne et al. p. 1537, italics added). In the present paper, we reflect on this “direct” perspective. We conjecture that the link between social rank and stress involves an intervening variable: an indirect relationship arises when the loss of rank triggers a behavioral response in the form of risk taking aimed at regaining rank, and it is the engagement in risk-taking behavior that is the cause of an elevated level of cortisol. Smith-Osborne et al., as well as others whose papers are cited by Smith-Osborne et al. and who, like Creel (2001) and Avitsur et al. (2006), conducted comprehensive research on the association between rank (social standing) and stress, do not refer to risk taking at all. We present four strands of research that lend support to our conjecture: evidence that in response to losing rank, individuals are stressed; evidence that in response to losing rank, individuals resort to risk-taking behavior aimed at regaining their lost rank; evidence that there exists a link between engagement in risky activities or exposure to risk and elevated levels of cortisol; and an analytical perspective on incidence and intensity, namely a perspective that shows how the willingness to take risks responds to a change in rank, specifically, how a loss of rank triggers a greater willingness to take risks and how this trigger is stronger for individuals whose rank is higher.

Suggested Citation

  • Stark, Oded & Wlodarczyk, Julia, 2024. "Rank, stress, and risk: A conjecture," Discussion Papers 342335, University of Bonn, Center for Development Research (ZEF).
    • Handle: RePEc:ags:ubzefd:342335
    DOI: 10.22004/ag.econ.342335
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    References listed on IDEAS

    as
    1. Stefan Grimm & Martin G. Kocher & Michal Krawczyk & Fabrice Lec, 2021. "Sharing or gambling? On risk attitudes in social contexts," Experimental Economics, Springer;Economic Science Association, vol. 24(4), pages 1075-1104, December.
    2. Christos Genakos & Mario Pagliero, 2012. "Interim Rank, Risk Taking, and Performance in Dynamic Tournaments," Journal of Political Economy, University of Chicago Press, vol. 120(4), pages 782-813.
    3. Oded Stark, 2017. "Migration when Social Preferences are Ordinal: Steady-state Population Distribution and Social Welfare," Economica, London School of Economics and Political Science, vol. 84(336), pages 647-666, October.
    4. Christian Grund & Jan Höcker & Stefan Zimmermann, 2013. "Incidence And Consequences Of Risk-Taking Behavior In Tournaments—Evidence From The Nba," Economic Inquiry, Western Economic Association International, vol. 51(2), pages 1489-1501, April.
    5. Oded Stark & Grzegorz Kosiorowski, 2023. "A pure theory of population distribution when preferences are ordinal," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 71(2), pages 317-342, October.
    6. Stark, Holger & Kosiorowski, Grzegorz, 2023. "A Pure Theory of Population Distribution When Preferences Are Ordinal," IZA Discussion Papers 15923, Institute of Labor Economics (IZA).
    7. Philipp Ager & Leonardo Bursztyn & Lukas Leucht & Hans-Joachim Voth, 2022. "Killer Incentives: Rivalry, Performance and Risk-Taking among German Fighter Pilots, 1939–45," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 89(5), pages 2257-2292.
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    More about this item

    Keywords

    Health Economics and Policy; Risk and Uncertainty;

    JEL classification:

    • D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles
    • D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution
    • D81 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Criteria for Decision-Making under Risk and Uncertainty
    • D87 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Neuroeconomics
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • I12 - Health, Education, and Welfare - - Health - - - Health Behavior
    • I14 - Health, Education, and Welfare - - Health - - - Health and Inequality

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