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Time Preferences and Lifetime Outcomes

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Author Info

  • Golsteyn, Bart H.H.

    ()
    (Maastricht University)

  • Grönqvist, Hans

    ()
    (SOFI, Stockholm University)

  • Lindahl, Lena

    ()
    (SOFI, Stockholm University)

Abstract

This paper investigates the relationship between time preferences and lifetime social and economic behavior. We use a Swedish longitudinal dataset that links information from a large survey on children's time preferences at age 13 to administrative registers spanning over five decades. Our results indicate a substantial adverse relationship between high discount rates and school performance, health, labor supply, and lifetime income. Males and high ability children gain significantly more from being future-oriented. These discrepancies are largest regarding outcomes later in life. We also show that the relationship between time preferences and long-run outcomes operates through early human capital investments.

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Bibliographic Info

Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 7165.

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Length: 41 pages
Date of creation: Jan 2013
Date of revision:
Publication status: forthcoming as: 'Adolescent Time Preferences Predict Lifetime Outcomes' in: Economic Journal
Handle: RePEc:iza:izadps:dp7165

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Keywords: health; human capital; intertemporal choice; personality; preference parameter; income;

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References

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Cited by:
  1. De Paola, Maria & Scoppa, Vincenzo, 2014. "Procrastination, Academic Success and the Effectiveness of a Remedial Program," IZA Discussion Papers 8021, Institute for the Study of Labor (IZA).

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