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The evolutionary theory of time preferences and intergenerational transfers

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  • Cyrus Chu, C.Y.
  • Chien, Hung-Ken
  • Lee, Ronald D.

Abstract

At each age an organism produces energy by foraging and allocates this energy among reproduction, survival, growth, and intergenerational transfers. We characterize the optimal set of allocation decisions that maximizes fitness. Time preference (the discount rate) is derived from the marginal rate of substitution between energy obtained at two different times or ages, holding fitness constant. Time preference varies with age in different ways depending on whether an individual is immature or mature, and during the transition between these stages. We conclude that time preference and discount rates are likely to be U-shaped across age.

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  • Cyrus Chu, C.Y. & Chien, Hung-Ken & Lee, Ronald D., 2010. "The evolutionary theory of time preferences and intergenerational transfers," Journal of Economic Behavior & Organization, Elsevier, vol. 76(3), pages 451-464, December.
    • Handle: RePEc:eee:jeborg:v:76:y:2010:i:3:p:451-464
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    1. Mao, Hui & Zhou, Li & Ying, RuiYao & Pan, Dan, 2021. "Time Preferences and green agricultural technology adoption: Field evidence from rice farmers in China," Land Use Policy, Elsevier, vol. 109(C).
    2. Junji Kageyama, 2009. "On the intertemporal allocation of consumption, mortality and life-history strategies," MPIDR Working Papers WP-2009-008, Max Planck Institute for Demographic Research, Rostock, Germany.
    3. Junji Kageyama & Kazuma Sato, 2021. "Explaining the U-shaped life satisfaction: dissatisfaction as a driver of behavior," Journal of Bioeconomics, Springer, vol. 23(2), pages 179-202, July.
    4. Burro, Giovanni & McDonald, Rebecca & Read, Daniel & Taj, Umar, 2022. "Patience decreases with age for the poor but not for the rich: an international comparison," Journal of Economic Behavior & Organization, Elsevier, vol. 193(C), pages 596-621.
    5. Lemoine, Derek, 2018. "Age-induced acceleration of time: Implications for intertemporal choice," Journal of Economic Behavior & Organization, Elsevier, vol. 153(C), pages 143-152.

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