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A measurement of decreasing impatience for health and money

Author

Listed:
  • Han Bleichrodt

    (Erasmus School of Economics)

  • Yu Gao

    (Polytechnic University of Milan)

  • Kirsten I. M. Rohde

    (Erasmus School of Economics)

Abstract

This paper measures deviations from constant discounting and compares these deviations for health and money. Our measurements make no assumptions about utility and do not require separability of preferences over time. In an experiment, most subjects were decreasingly impatient, but a substantial minority was increasingly impatient. The deviations from constant discounting were more pronounced for health than for money suggesting that time preferences are domain-specific. Hyperbolic discounting (Loewenstein and Prelec, Quarterly Journal of Economics, 107, 573–597, 1992) and proportional discounting (Mazur, Quantitative Analyses of Behavior, 5, 55–73, 1987) best described time preferences. Quasi-hyperbolic discounting, the most popular model to accommodate deviations from constant discounting, was rejected for both health and money.

Suggested Citation

  • Han Bleichrodt & Yu Gao & Kirsten I. M. Rohde, 2016. "A measurement of decreasing impatience for health and money," Journal of Risk and Uncertainty, Springer, vol. 52(3), pages 213-231, June.
    • Handle: RePEc:kap:jrisku:v:52:y:2016:i:3:d:10.1007_s11166-016-9240-0
    DOI: 10.1007/s11166-016-9240-0
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    3. Arthur E. Attema & Han Bleichrodt & Olivier L’Haridon & Patrick Peretti-Watel & Valérie Seror, 2018. "Discounting health and money: New evidence using a more robust method," Journal of Risk and Uncertainty, Springer, vol. 56(2), pages 117-140, April.
    4. Dániel Horn & Hubert János Kiss, 2020. "Time preferences and their life outcome correlates: Evidence from a representative survey," PLOS ONE, Public Library of Science, vol. 15(7), pages 1-26, July.
    5. Mohammed Abdellaoui & Cédric Gutierrez & Emmanuel Kemel, 2018. "Temporal discounting of gains and losses of time: An experimental investigation," Journal of Risk and Uncertainty, Springer, vol. 57(1), pages 1-28, August.
    6. Jindrich Matousek & Tomas Havranek & Zuzana Irsova, 2022. "Individual discount rates: a meta-analysis of experimental evidence," Experimental Economics, Springer;Economic Science Association, vol. 25(1), pages 318-358, February.
    7. Rong Rong & Therese C. Grijalva & Jayson Lusk & W. Douglass Shaw, 2019. "Interpersonal discounting," Journal of Risk and Uncertainty, Springer, vol. 58(1), pages 17-42, February.
    8. Irvine, Alastair & van der Pol, Marjon & Phimister, Euan, 2019. "A comparison of professional and private time preferences of General Practitioners," Social Science & Medicine, Elsevier, vol. 222(C), pages 256-264.
    9. Sujata Behera, 2020. "Does the EVA valuation model explain the market value of equity better under changing required return than constant required return?," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 6(1), pages 1-23, December.
    10. José Luis Pinto‐Prades & Fernando Ignacio Sánchez‐Martínez & José María Abellán‐Perpiñán & Jorge E. Martínez‐Pérez, 2018. "Reducing preference reversals: The role of preference imprecision and nontransparent methods," Health Economics, John Wiley & Sons, Ltd., vol. 27(8), pages 1230-1246, August.
    11. Elahe Khorasani & Majid Davari & Abbas Kebriaeezadeh & Farshad Fatemi & Ali Akbari Sari & Vida Varahrami, 2022. "A comprehensive review of official discount rates in guidelines of health economic evaluations over time: the trends and roots," The European Journal of Health Economics, Springer;Deutsche Gesellschaft für Gesundheitsökonomie (DGGÖ), vol. 23(9), pages 1577-1590, December.
    12. Yang Wang & Frank A. Sloan, 2018. "Present bias and health," Journal of Risk and Uncertainty, Springer, vol. 57(2), pages 177-198, October.
    13. Kirsten I. M. Rohde, 2019. "Measuring Decreasing and Increasing Impatience," Management Science, INFORMS, vol. 65(4), pages 1700-1716, April.
    14. Shotaro Shiba & Kazumi Shimizu, 2018. "Does time inconsistency differ between gain and loss? An intra-personal comparison using a non-parametric elicitation method (A revised version)," Working Papers 1807, Waseda University, Faculty of Political Science and Economics.
    15. Nina Anchugina, 2017. "One-Switch Discount Functions," Papers 1702.02254, arXiv.org.
    16. Fredslund, Eskild Klausen & Mørkbak, Morten Raun & Gyrd-Hansen, Dorte, 2018. "Different domains – Different time preferences?," Social Science & Medicine, Elsevier, vol. 207(C), pages 97-105.
    17. Alexis Direr, 2020. "Bringing present bias back to the present," Working Papers hal-02133525, HAL.
    18. Stefan A Lipman & Arthur E Attema, 2020. "Good things come to those who wait—Decreasing impatience for health gains and losses," PLOS ONE, Public Library of Science, vol. 15(3), pages 1-15, March.
    19. Sule Alan & Seda Ertac & Inci Gumus, 2021. "Does a forward‐looking perspective affect self‐control and the demand for commitment? Results from an educational intervention," Economic Inquiry, Western Economic Association International, vol. 59(4), pages 1533-1546, October.
    20. Manel Baucells & Lin Zhao, 2019. "It Is Time to Get Some Rest," Management Science, INFORMS, vol. 65(4), pages 1717-1734, April.
    21. Aurélien Baillon & Owen O'Donnell & Stella Quimbo & Kim van Wilgenburg, 2022. "Do time preferences explain low health insurance take‐up?," Journal of Risk & Insurance, The American Risk and Insurance Association, vol. 89(4), pages 951-983, December.
    22. Shotaro Shiba & Kazumi Shimizu, 2020. "Does time inconsistency differ between gain and loss? An intra-personal comparison using a non-parametric elicitation method," Theory and Decision, Springer, vol. 88(3), pages 431-452, April.
    23. Shotaro Shiba & Kazumi Shimizu, 2017. "Does Time Inconsistency Differ between Gain and Loss? An Intra-Personal Comparison Using a Non-Parametric Designed Experimen," Working Papers 1714, Waseda University, Faculty of Political Science and Economics.
    24. Salvador Cruz Rambaud & Isabel González Fernández, 2019. "A measure of inconsistencies in intertemporal choice," PLOS ONE, Public Library of Science, vol. 14(10), pages 1-24, October.

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