Saving future lives. A comparison of three discounting models

Abstract

This paper compares three models of intertemporal choice concerning saving future lives: the constant discounting model, the proportional discounting model and the hyperbolic discounting model. The three models were investigated using data collected from the general public. Since these data have a multilevel structure, ordinary least-squares (OLS) estimates were supplemented by multilevel analysis. There is evidence in favour of the proportional (and to a lesser extent) the hyperbolic model over the constant discounting model. There is clear evidence for this data set that multilevel analysis is more appropriate than OLS.

Social Time Preferences for Health and Money Elicited with a Choice Experiment

“…The mean values and other descriptive statistics were given for statistical reasons, to illustrate that the distribution of time preferences appeared to be rather skewed. The implied social discount rates in this study were calculated by a constant exponential discounting function and were generally lower than found in most other studies, both for health [25–30] and for money [30], but were similar as those found by West et al. [24].…”

“…This domain effect was confirmed by the finding that time preference for an environmental good (i.e., noise pollution) was also stronger. Several studies employing a social perspective reported higher discount rates for health compared to money [28–31], although one found lower median discount rates for health [24]. We hypothesize that most differences between our results and other studies cited above may be explained by differences in study population (students and general public vs. health‐care workers and policymakers) and by differences in framing.…”

Association of time preference for health with age and disease severity

“…Previous studies have suggested that the discounted utility model may not accurately describe the individual preferences for aversive health outcomes and that implied discount rates decrease as a function of delay [6,7,25]. Modifications of the exponential discount model, such as a loglinear model or a hyperbolic discounting functions might represent individual preferences more accurately than the discounted utility model [5]. In some of our patients we found no solution to the discount rate function.…”

To Vaccinate or to Procrastinate? That is the Prevention Question

“…Bradford () demonstrated that time preferences matter for health maintenance habits, including Pap smears, dental visits, and flu shots. As early as in 1997, Cairns and van der Pol showed that it is not merely discounting that matters in health domains but time‐inconsistent preferences (Cairns and van der Pol, ). By now, there is a considerable body of literature that investigates how time inconsistencies relate to smoking behavior and obesity.…”