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Does Education Matter in Patience Formation? Evidence from Ugandan Villages Author info | Abstract | Publisher info | Download info | Related research | Statistics Michal Bauer (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic )
Julie Chytilová (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic )
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The paper aims to contribute to the understanding of why there is a lack of domestic saving and investment in rural parts of sub-Saharan Africa. It focuses on heterogeneity in inter-temporal preferences as a possible explanation of this important puzzle. The study is based on a unique experimental data set collected from 856 respondents in Ugandan villages and scrutinizes how individual patience – measured by the discount rate – is formed. The results suggest that Ugandan respondents are substantially less patient than their counterparts in similar experimental studies undertaken in developed countries and South Asia. We find a strong negative association between the level of education and the individual discount rate. Furthermore, we took advantage of the Ugandan education reform in 1996 and varying school frequency to demonstrate the causal relationship stemming from education to patience. The estimates suggest that an additional year at school decreases the discount rate on average by 35 percentage points after controlling for other characteristics (age, income group, sex, marital status and clan linkage). Our findings strongly accord with patience understood as a non-cognitive ability which needs to be taught by parents, learnt at school and promoted by social norms. The Ugandan responses, therefore, propose a new way in which education may influence development in sub-Saharan Africa – by shaping individual patience.
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Paper provided by Charles University Prague, Faculty of Social Sciences, Institute of Economic Studies in its series Working Papers IES with number
2007/10.
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Length: 19 pages
Date of creation: Feb 2007Date of revision:
Feb 2007Handle: RePEc:fau:wpaper:wp2007_10Contact details of provider: Postal: Opletalova 26, CZ-110 00 Prague Phone: +420 2 222112330 Fax: +420 2 22112304 Email: Web page: http://ies.fsv.cuni.cz/ More information through EDIRC
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Keywords: Time preference ; patience ; discount rate ; education ; savings ; economic development ; field survey ; sub-Saharan Africa ; Other versions of this item:
Find related papers by JEL classification: C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments D91 - Microeconomics - - Intertemporal Choice and Growth - - - Intertemporal Consumer Choice; Life Cycle Models and Saving O12 - Economic Development, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
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