Outcome- And Sign-Dependent Time Preferences: An Incentivized Intertemporal Choice Experiment Involving Effort And Money

Previous research consistently identified differences in time preferences between effort and monetary decisions. However, the root cause of this difference—whether it stemmed from the intrinsic nature of the outcomes or the associated pleasurable or unpleasurable experiences— remained undefined. In response, we conducted novel two-stage experiments employing a 2 × 2 design contrasting outcomes (money and effort) and domains (gain and loss). This approach allowed for the incentivization of all decisions, including those involving future monetary losses. Our study reveals that present bias is absent at the median for both monetary and effort-based choices, whereas the size of individual deviations from time-consistent choice, in either direction, is significantly larger for effort, indicating outcome-dependent preferences. Effort choices are also smoother than monetary choices and far more heterogeneous across individuals in their time preferences.