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Long term stability of time preferences and the role of the macroeconomic situation

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  • Hardardottir, Hjördis

Abstract

We look at the stability of survey based subjective time preferences over time using data from a Dutch panel survey with a long time horizon and find that the ranking of individual time preferences is stable. Simple observation of the aggregated measured time preferences reveals instability in aggregated preferences. In order to shed light on this instability we look at the relationship between the individual socio-economic situation and time preferences and the macroeconomic situation and time preferences. While we find no clear relationship between socio-economic situation and time preferences, we find that for the sample as a whole patience is positively correlated with economic growth, but negatively correlated with income inequality. When studying how the estimations differ across income groups we observe that there is a considerable asymmetry in how different income groups react to changes in the macroeconomic situation.

Suggested Citation

  • Hardardottir, Hjördis, 2017. "Long term stability of time preferences and the role of the macroeconomic situation," Journal of Economic Psychology, Elsevier, vol. 60(C), pages 21-36.
    • Handle: RePEc:eee:joepsy:v:60:y:2017:i:c:p:21-36
    DOI: 10.1016/j.joep.2016.12.006
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    Citations

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    Cited by:

    1. Nicolás Salamanca & Buly A. Cardak & Edwin Ip & Joe Vecci, 2023. "Time-stability of risk preferences: A new approach with evidence from developed and developing countries," Discussion Papers 2305, University of Exeter, Department of Economics.
    2. Armando N. Meier, 2019. "Emotions, Risk Attitudes, and Patience," SOEPpapers on Multidisciplinary Panel Data Research 1041, DIW Berlin, The German Socio-Economic Panel (SOEP).
    3. repec:cup:judgdm:v:17:y:2022:i:4:p:745-767 is not listed on IDEAS
    4. Preuss, Malte, 2021. "Intra-individual stability of two survey measures on forward-looking attitude," Journal of Economic Behavior & Organization, Elsevier, vol. 190(C), pages 201-227.
    5. Golsteyn, Bart H. H. & Schildberg-Hörisch, Hannah, 2017. "Challenges in research on preferences and personality traits: Measurement, stability, and inference," DICE Discussion Papers 263, Heinrich Heine University Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    6. Kossova, Tatiana & Kossova, Elena & Sheluntcova, Maria, 2018. "Anti-smoking policy in Russia: Relevant factors and program planning," Evaluation and Program Planning, Elsevier, vol. 69(C), pages 43-52.
    7. Tim Friehe & Markus Pannenberg, 2020. "Time preferences and political regimes: evidence from reunified Germany," Journal of Population Economics, Springer;European Society for Population Economics, vol. 33(1), pages 349-387, January.
    8. repec:jdm:journl:v:17:y:2022:i:4:p:745-767 is not listed on IDEAS
    9. Kureishi, Wataru & Paule-Paludkiewicz, Hannah & Tsujiyama, Hitoshi & Wakabayashi, Midori, 2020. "Time preferences over the life cycle," SAFE Working Paper Series 267, Leibniz Institute for Financial Research SAFE, revised 2020.

    More about this item

    Keywords

    Time preferences; Stability of preferences; Income inequality; Economic growth; Socially determined preferences;
    All these keywords.

    JEL classification:

    • D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles
    • D63 - Microeconomics - - Welfare Economics - - - Equity, Justice, Inequality, and Other Normative Criteria and Measurement
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials

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