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Is there a Daily Discount Rate? Evidence from the Food Stamp Nutrition Cycle

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Author Info
Jesse M. Shapiro (Harvard University)

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Abstract

A central prediction of the quasi-hyperbolic model of time preference is that consumers will be impatient over short-run tradeoffs. I present the first nonlaboratory test of this implication using data on the nutritional intake of food stamp recipients. Caloric intake declines by 10 to 15 percent over the 30-day period following receipt of food stamps, implying a significant preference for immediate consumption. Resulting estimates of the daily discount rate are inconsistent with any reasonable calibration of an exponential discounting model. The data support an explanation based on time preference and reject several alternative explanations, including high elasticities of intertemporal substitution, strategic interactions and food depreciation.

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File URL: http://129.3.20.41/eps/mic/papers/0304/0304005.pdf
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Publisher Info
Paper provided by EconWPA in its series Microeconomics with number 0304005.

Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Length: 40 pages
Date of creation: 21 Apr 2003
Date of revision: 21 Apr 2003
Handle: RePEc:wpa:wuwpmi:0304005

Note: Type of Document - Acrobat PDF; prepared on IBM PC; to print on HP; pages: 40 ; figures: included
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Web page: http://129.3.20.41

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Related research
Keywords: food stamps; nutrition; hyperbolic discounting; quasi- hyperbolic discounting;

Other versions of this item:

Find related papers by JEL classification:
I12 - Health, Education, and Welfare - - Health - - - Health Production
D91 - Microeconomics - - Intertemporal Choice and Growth - - - Intertemporal Consumer Choice; Life Cycle Models and Saving
D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
I38 - Health, Education, and Welfare - - Welfare and Poverty - - - Government Programs; Provision and Effects of Welfare Programs

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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    Other versions:
  3. Jonathan Gruber & Botond Koszegi, 2000. "Is Addiction "Rational"? Theory and Evidence," NBER Working Papers 7507, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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    Other versions:
  9. Ted O'Donoghue & Matthew Rabin, 2001. "Choice And Procrastination," The Quarterly Journal of Economics, MIT Press, vol. 116(1), pages 121-160, February. [Downloadable!] (restricted)
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  12. Wilde, Parke E & Ranney, Christine K, 2000. " The Monthly Food Stamp Cycle: Shopping Frequency and Food Intake Decisions in an Endogenous Switching Regression Framework," American Journal of Agricultural Economics, American Agricultural Economics Association, vol. 82(1), pages 200-213, February. [Downloadable!] (restricted)
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Neeraj Kaushal & Qin Gao, 2009. "Food Stamp Program and Consumption Choices," NBER Working Papers 14988, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  2. McLeish, Kendra N & Oxoby, Robert J, 2006. "Measuring Impatience: Elicited Discount Rates and the Barratt Impulsiveness Scale," MPRA Paper 1524, University Library of Munich, Germany. [Downloadable!]
    Other versions:
  3. King, Robert P. & Damon, Amy L. & Leibtag, Ephraim, 2006. "Household Food Expenditures across Income Groups: Do Poor Households Spend Differently than Rich Ones?," 2006 Annual meeting, July 23-26, Long Beach, CA 21470, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association). [Downloadable!]
    Other versions:
  4. Michael S. Barr & Jane K. Dokko, 2008. "Paying to save: tax withholding and asset allocation among low- and moderate-income taxpayers," Finance and Economics Discussion Series 2008-11, Board of Governors of the Federal Reserve System (U.S.). [Downloadable!]
  5. Mark L. Hoekstra & Scott Hankins & Paige Marta Skiba, 2008. "The Ticket to Easy Street? The Financial Consequences of Winning the Lottery," Working Papers 344, University of Pittsburgh, Department of Economics, revised Oct 2009. [Downloadable!]
  6. Dora Gicheva & Justine Hastings & Sofia Villas-Boas, 2007. "Revisiting the Income Effect: Gasoline Prices and Grocery Purchases," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series 1044R, Department of Agricultural & Resource Economics, UC Berkeley. [Downloadable!]
    Other versions:
  7. Nava Ashaf & Dean Karlan & Wesley Yin, 2004. "Tying Odysseus to the Mast: Evidence from a Commitment Savings Product in the Philippines," Natural Field Experiments 0007, The Field Experiments Website. [Downloadable!]
  8. C. Fritz Foley, 2008. "Welfare Payments and Crime," NBER Working Papers 14074, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  9. Juan Carlos Chavez-Martin del Campo, 2008. "On the design of an optimal transfer schedule with time inconsistent preferences," Economics Bulletin, Economics Bulletin, vol. 8(5), pages 1-7. [Downloadable!]
  10. Mark Aguiar & Erik Hurst, 2004. "Consumption vs. Expenditure," NBER Working Papers 10307, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  11. Stephan Meier & Charles Sprenger, 2007. "Impatience and credit behavior: evidence from a field experiment," Working Papers 07-3, Federal Reserve Bank of Boston. [Downloadable!]
  12. Kendra N. McLeish & Robert J. Oxoby, 2007. "Gender, Affect and Intertemporal Consistency: An Experimental Approach," IZA Discussion Papers 2663, Institute for the Study of Labor (IZA). [Downloadable!]
  13. Daniel J. Benjamin & James J. Choi & A. Joshua Strickland, 2007. "Social Identity and Preferences," NBER Working Papers 13309, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
  14. Giovanni Mastrobuoni & Matthew Weinberg, 2007. "Heterogeneity in Intra-Monthly Consumption Patterns, Self-Control, and Savings at Retirement," Carlo Alberto Notebooks 36, Collegio Carlo Alberto. [Downloadable!]
  15. Marco Gui & Luca Stanca, 2009. "Television Viewing, Satisfaction and Happiness: Facts and Fiction," Working Papers 167, University of Milano-Bicocca, Department of Economics, revised Jul 2009. [Downloadable!]
  16. Marques Benton & Stephan Meier & Charles Sprenger, 2007. "Overborrowing and undersaving: lessons and policy implications from research in behavioral economics," Public and Community Affairs Discussion Papers 2007-4, Federal Reserve Bank of Boston. [Downloadable!]
  17. Francesco Drago, 2006. "Career Consequences of Hyperbolic Time Preferences," IZA Discussion Papers 2113, Institute for the Study of Labor (IZA). [Downloadable!]
  18. Katherine L. Milkman & John L. Beshears, 2007. "Mental Accounting and Small Windfalls: Evidence from an Online Grocer," Harvard Business School Working Papers 08-024, Harvard Business School, revised Sep 2008. [Downloadable!]
    Other versions:
  19. Daniel J. Benjamin & Sebastian A. Brown & Jesse M. Shapiro, 2006. "Who is “Behavioral”? Cognitive Ability and Anomalous Preferences," Levine's Working Paper Archive 122247000000001334, David K. Levine. [Downloadable!]
  20. Mark L. Hoekstra & Scott Hankins, 2007. "Lucky in Life, Unlucky in Love? The Effect of Random Income Shocks on Marriage and Divorce," Working Papers 329, University of Pittsburgh, Department of Economics, revised Apr 2009. [Downloadable!]
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