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Time preferences and lifetime outcomes

  • Golsteyn, Bart


    (ROA, Maastricht University)

  • Grönqvist, Hans


    (Swedish Institute for Social Research (SOFI), Stockholm University)

  • Lindahl, Lena


    (Swedish Institute for Social Research (SOFI))

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 four 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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Paper provided by IFAU - Institute for Evaluation of Labour Market and Education Policy in its series Working Paper Series with number 2013:22.

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Length: 33 pages
Date of creation: 04 Oct 2013
Date of revision:
Publication status: Published as Golsteyn, Bart, Hans Grönqvist and Lena Lindahl, 'Adolescent Time Preferences Predict Lifetime Outcomes' in The Economic Journal, 2014, pages 739-761.
Handle: RePEc:hhs:ifauwp:2013_022
Contact details of provider: Postal: IFAU, P O Box 513, SE-751 20 Uppsala, Sweden
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