The Endogenous Determination of Time Preference

Becker, Gary S.; Mulligan, Casey B.

doi:10.1162/003355397555334

Cited by 1,073 publications

(848 citation statements)

References 25 publications

Supporting

Mentioning

731

Contrasting

Unclassified

Order By: Relevance

“…Becker and Mulligan (1997) proposed a model to capture endogenous time preferences. It states that the more resources we use to imagine the future, the more patient we are.…”

Section: Wealthmentioning

confidence: 99%

How Time Preferences Differ: Evidence from 45 Countries

2010

View full text Add to dashboard Cite

We present results from the first large-scale international survey on time preference, conducted in 53 countries. All countries exhibit hyperbolic discounting patterns, i.e., the immediate future is discounted more than far future. We also observe higher heterogeneity for shorter time horizons, consistent with the pattern reviewed by Frederick, Loewenstein, and O'Donoghue (2002). Cultural factors as captured by the Hofstede cultural dimensions (Hofstede, 1991) contribute significantly to the variation of time discounting, even after controlling for economic factors, such as GDP, inflation rate and growth rate. In particular, higher levels of Uncertainty Avoidance are associated with stronger hyperbolic discounting, whereas higher degrees of Individualism and Long Term Orientation predict stronger tendency to wait for larger payoffs. We also find the waiting tendency is correlated with innovation, environmental protection, crediting rating, and body mass index at country level after controlling for county wealth. These results help us to enhance the understanding of differences across financial markets and economic behavior worldwide.

show abstract

“…Becker and Mulligan (1997) proposed a model to capture endogenous time preferences. It states that the more resources we use to imagine the future, the more patient we are.…”

Section: Wealthmentioning

confidence: 99%

How Time Preferences Differ: Evidence from 45 Countries

2010

View full text Add to dashboard Cite

show abstract

“…While it is of great interest to know that a certain Nash equilibrium exists for sufficiently patient agents, we cannot expect a real social group to have extremely patient members. Indeed, there is likely to be a statistical distribution of discount rates among members, reflecting such considerations as age, health, reproductive status, as well as idiosyncratic factors (Hansson and Stuart 1990, Rogers 1994, Becker and Mulligan 1997. The lower tail of such a distribution determines the degree of patience of the group, and so long as the distribution of discount factors has positive variance, the practice of taking the limit as the discount factor goes to unity will not be acceptable.…”

Section: Cooperation Of Self-interested Agents With Publicmentioning

confidence: 99%

Modeling cooperation among self-interested agents: a critique

Gintis

2004

The Journal of Socio-Economics

View full text Add to dashboard Cite

“…It is useful to stress that this is achieved by simply allowing for di¤erences in …scal policy and the degree of patience; the latter means that Italians have been less patient than Germans during the euro period. 5 In turn, we use this solution as a point of departure to study the dynamic evolution of endogenous variables in response to policy reforms, focusing on debt consolidation in the high-debt country, namely, Italy.…”

Section: Introductionmentioning

confidence: 99%

Fiscal consolidation and its cross-country effects

Philippopoulos

Varthalitis

Vassilatos

2017

Journal of Economic Dynamics and Control

View full text Add to dashboard Cite

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. We build a new Keynesian DSGE model consisting of two heterogeneous countries participating in a monetary union. We study how public debt consolidation in a country with high debt (like Italy) affects welfare in a country with solid public finances (like Germany). Our results show that debt consolidation in the high-debt country benefits the country with solid public finances over all time horizons. By constrast, in Italy, namely the country that takes the consolidation measures, such a policy is productive only in the medium and long term. Thus, although there is a conflict of national interests in shorter horizons, there is a common interest in the medium and long term. All this is with optimized feedback policy rules. By contrast, debt consolidation is welfare inferior to non-consolidation for both countries and all the time, if it is implemented in an ad hoc way, like an increase in income taxes. Therefore, the policy mix is important. Terms of use: Documents inJEL-Codes: E600, F300, H600.

show abstract

The Endogenous Determination of Time Preference

Cited by 1,073 publications

References 25 publications

How Time Preferences Differ: Evidence from 45 Countries

How Time Preferences Differ: Evidence from 45 Countries

Modeling cooperation among self-interested agents: a critique

Fiscal consolidation and its cross-country effects

Contact Info

Product

Resources

About