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Rao Wealth Partners is an independent firm with securities offered through Summit Brokerage Services, Inc., member FINRA and SIPC. Advisory services are offered through Summit Financial Group, Inc., a registered investment advisor. Summit is an independent broker-dealer with client assets held at First Clearing, LLC (a wholly owned Wells Fargo subsidiary). Summit and its affiliates are under separate ownership from any other named entity. You can name every bone in the body, but you can't name a single investment in your retirement account. It's time for a change. (212) 257-5794 www.raowp.com Individual Stock Selection | Corporate Retirement Accounts | Educational Savings Plans RAOWP_5H_058480082N_REV.indd 1 2/27/18 12:46 PM RESEARCHERS: Risk-Takers Needed to Fuel R&D BY THOMAS CROCKER INDIVIDUALS WHO ARE INCLINED TO TAKE RISKS ARE MORE LIKELY TO MAKE DECISIONS THAT LE AD TO INNOVATION, A KE Y FACTOR THAT COMPANIES SHOULD CONSIDER A S THE Y SEEK TO JUMPSTART RESE ARCH AND DE VELOPMENT — AND ECONOMIC GROW TH — IN THE WAKE OF THE COVID-19 VIRUS. IN THE PHARMACEUTICAL a nd biotechnolog y industries, R&D spending is up, but compa nies a re producing fewer new dr ugs a nd treatments. That 's due, in pa r t, to risk aversion a mong R &D decision-ma kers, according to the authors of a Universit y of Ca lifor nia Sa n Diego-led st udy published i n t he Nat iona l Bu reau of Econom ic R esea rch Work i n g Papers Series. To understa nd how risk tolera nce a f fects the pursuit of innovation, the resea rchers desig ned experiments that asked g raduate-level students at UC Sa n Diego's R ady School of Ma na gement to i nvest i n hy pot hetica l project s. Despite f ina ncia l incentives to suppor t riskier ventures, a majority of pa r ticipa nts consistently favored more conser vative options, rejecting the notion that g reat risk ca n bring g reat rewa rd. The resea rchers cla ssif ied on ly 12% of pa r ticipa nts a s r i sk-lov i n g , but t hose people were mos t l i kely t o m a ke innovation-friend ly decisions. Identif y ing indiv idua ls who a re comfor table ta king risks a nd ta sking them with leading R &D ef for t s is key to t he pu rsuit of new discover ies a nd rev ita lizing the economy, according to the resea rchers. n 059990062_FN1_EconomicProspects.indd 1 7/2/20 3:51 PM 2 6❱❱❱❱❱ F I N A N C E