Do Discount Rates Change over Time? Experimental Evidence from Ethiopia
AbstractThis study tests the hyperbolic discounting hypothesis using real-payoff experiments in Ethiopia. We compared time preferences over cash and consumption goods and over different time horizons. We found that participants made consistent choices over time and that responses did not vary across payment type. However, participants offered an immediate payment option first selected the impatient reward more often than those offered a delayed payment initially. Participants with greater livestock wealth and smaller landholdings were more likely to select the patient reward.
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Bibliographic InfoPaper provided by Resources For the Future in its series Discussion Papers with number dp-08-06-efd.
Date of creation: 07 Mar 2008
Date of revision:
Field experiment; hyperbolic discounting; intertemporal choice;
Find related papers by JEL classification:
- C93 - Mathematical and Quantitative Methods - - Design of Experiments - - - Field Experiments
- D90 - Microeconomics - - Intertemporal Choice - - - General
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