Could We Blame the Financial Crisis on Too Much Testosterone? Harvard Researchers Say Yes

When it comes to determining how much of a financial risk-taker a man is, don't look him in the eye, look him in the jaw. Is your financial planner a ringer for Arnold? Does he have a jaw like Viggo?

On further examination, does he have a heavy or "low" brow like Moe, on the Simpsons? Throw in thin lips a la Bruce Willis and as the relatively full-lipped Robert Preston sang, "Ya got Trouble."

Ignore those innocent baby blues: a man's attitude to risk is bred in the bone, which reflects how much testosterone courses through his body. The more he has, the more likely he is to take risks with his money. Or yours.

Or so Harvard researchers report in the science journal Evolution and Human Behaviour.

Economist Anna Dreber and anthropologist Coren Apicella theorize that Wall Street's red-suspendered boys -- or as I think of them, the greedy architects of the new recession -- can't help themselves because they have more testosterone than average, which makes them take big risks to earn big prizes. That's an advantage when chasing woolly mammoths with wooden spears, but it's likely to cause problems in money management.

The scientific findings

Apparently, the rules for rational investing can't counter that evolutionary urge to risk it all on a death-defying feat (with your RRSP). To determine this, the study tested the hormone levels of 100 young men and then gave them $250 and told them they could keep it, invest part of it, or invest it all -- on a coin toss.

Those with testosterone poisoning (not the technical term) invested 12 per cent more than men with average hormone levels. And a man's testosterone levels are written on his face.

The influence of testosterone on facial features is linked to high hormone levels in adolescence, the same point at which men develop their attitudes to risk. Those with exaggerated masculine features -- commonly called "strong" faces -- are inclined to take long shots, which is likely to pay-off in some careers such as sports, movie or rock star. But That Guy is not who you want brokering international peace treaties or running your bank.

With these new findings I'm happy to reconsider my observation that too many men do too much of their thinking with the little head. Turns out that, for some men, the boys are also involved in an unholy trinity replacing rational thought.

Considering the implications

Of course, I'm itching to extrapolate on these findings. But before speculating on how soon corporate criminals will be using the testosterone defence -- maybe the heavy-browed, thin-lipped Conrad Black could appeal? -- let's consider the implications for modern life.

In evolutionary terms, the risk-takers were selected because their actions gave them some success at dipping in the gene pool and keeping their progeny alive. Although, with mammoth-tackling being what it is, it's fair to say that those ancient daredevils probably did more to ensure the survival of their slightly savvier tribe-mates who hung back, took calculated risks, and passed on what is now the average testosterone level. Let's face it, taking point against a one-ton quarry isn't conducive to long life and big families.

So our successful evolution as a species is probably the result of just enough practitioners of hormone-driven irrational acts to provide us with some regular protein. Which makes sense. Until recently, it was obvious that the daring of the few could benefit the majority.

Think about the origins of Canada. Only some sort of madness could explain why men ventured across the Atlantic in tiny boats and settled in inhospitable places like Quebec and Ontario. Imagine what that -40 (with the wind chill) would have felt like sans central heating, Gore-Tex, and Sorrels. Spend one winter in Montreal (contemplating who in his right mind would have settled here in the 17th century) and the community benefits of having had ancestors with a crazy disregard for the downside of risk is obvious.