Measuring Time Preferences

Jonathan D. Cohen, Keith Ericson, David Laibson and John Myles White

No 22455, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We review research that measures time preferences—i.e., preferences over intertemporal tradeoffs. We distinguish between studies using financial flows, which we call “money earlier or later” (MEL) decisions and studies that use time-dated consumption/effort. Under different structural models, we show how to translate what MEL experiments directly measure (required rates of return for financial flows) into a discount function over utils. We summarize empirical regularities found in MEL studies and the predictive power of those studies. We explain why MEL choices are driven in part by some factors that are distinct from underlying time preferences.

JEL-codes: D03 D9 (search for similar items in EconPapers)
Date: 2016-07
New Economics Papers: this item is included in nep-evo, nep-exp and nep-upt
Note: AG PE
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (44)

Published as Jonathan Cohen & Keith Marzilli Ericson & David Laibson & John Myles White, 2020. "Measuring Time Preferences," Journal of Economic Literature, vol 58(2), pages 299-347.

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