IDEAS home Printed from https://ideas.repec.org/p/diw/diwsop/diw_sp974.html
   My bibliography  Save this paper

Age Differences in Intertemporal Choice: U-Shaped Associations in a Probability Sample of German Households

Author

Listed:
  • David Richter
  • Rui Mata

Abstract

To describe adult age differences in intertemporal choice, we analyzed data from 1,491 participants who completed an incentivized monetary intertemporal discounting choice task involving different conditions (e.g., time delay of 12 months vs. 1 month). Respondents completed a number of other survey measures, including behavioral measures of cognitive ability, and self-reports concerning health, financial security, and demographic characteristics. We found significant quadratic (U-shaped) effects of age in task conditions involving 12-month (but not 1-month) delays, with middle-aged adults proving most patient relative to younger and older adults. The age effects found were robust to the inclusion of covariates, including cognitive ability, that have been suggested to underlie individual and age differences in time preferences. The results favor theories that propose non-linear effects of age-related processes or multiple mechanisms underlying the development of intertemporal choice across the life span and suggest that it is important to consider long time delays and wide age ranges when trying to understand age differences in time preferences.

Suggested Citation

  • David Richter & Rui Mata, 2018. "Age Differences in Intertemporal Choice: U-Shaped Associations in a Probability Sample of German Households," SOEPpapers on Multidisciplinary Panel Data Research 974, DIW Berlin, The German Socio-Economic Panel (SOEP).
    • Handle: RePEc:diw:diwsop:diw_sp974
    as

    Download full text from publisher

    File URL: https://www.diw.de/documents/publikationen/73/diw_01.c.595118.de/diw_sp0974.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Trostel, Philip A & Taylor, Grant A, 2001. "A Theory of Time Preference," Economic Inquiry, Western Economic Association International, vol. 39(3), pages 379-395, July.
    2. Olivier Toubia & Eric Johnson & Theodoros Evgeniou & Philippe Delquié, 2013. "Dynamic Experiments for Estimating Preferences: An Adaptive Method of Eliciting Time and Risk Parameters," Management Science, INFORMS, vol. 59(3), pages 613-640, June.
    3. Gert G. Wagner & Joachim R. Frick & Jürgen Schupp, 2007. "The German Socio-Economic Panel Study (SOEP) – Scope, Evolution and Enhancements," Schmollers Jahrbuch : Journal of Applied Social Science Studies / Zeitschrift für Wirtschafts- und Sozialwissenschaften, Duncker & Humblot, Berlin, vol. 127(1), pages 139-169.
    4. Jule Specht & Boris Egloff & Stefan C. Schmukle, 2011. "Stability and Change of Personality across the Life Course: The Impact of Age and Major Life Events on Mean-Level and Rank-Order Stability of the Big Five," SOEPpapers on Multidisciplinary Panel Data Research 377, DIW Berlin, The German Socio-Economic Panel (SOEP).
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Kulati, Ellam & Myck, Michał & Pasini, Giacomo, 2023. "Temporal discounting in later life," Journal of Economic Behavior & Organization, Elsevier, vol. 213(C), pages 87-101.
    2. Bertoli, Paola & Grembi, Veronica & Morelli, Massimo & Rosso, Anna Cecilia, 2023. "In medio stat virtus? Effective communication and preferences for redistribution in hard times," Journal of Economic Behavior & Organization, Elsevier, vol. 214(C), pages 105-147.
    3. Jiri Rotschedl & Helena Mitwallyova, 2021. "Study of Intertemporal Discounting According to Age Groups," International Journal of Economic Sciences, European Research Center, vol. 10(2), pages 127-140, December.
    4. Preuss, Malte, 2021. "Intra-individual stability of two survey measures on forward-looking attitude," Journal of Economic Behavior & Organization, Elsevier, vol. 190(C), pages 201-227.
    5. 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.
    6. Fidanoski, Filip & Johnson, Timothy, 2023. "A z-Tree implementation of the Dynamic Experiments for Estimating Preferences [DEEP] method," Journal of Behavioral and Experimental Finance, Elsevier, vol. 38(C).
    7. William J. Skylark & Kieran T. F. Chan & George D. Farmer & Kai W. Gaskin & Amelia R. Miller, 2020. "The delay-reward heuristic: What do people expect in intertemporal choice tasks?," Judgment and Decision Making, Society for Judgment and Decision Making, vol. 15(5), pages 611-629, September.
    8. repec:cup:judgdm:v:15:y:2020:i:5:p:611-629 is not listed on IDEAS
    9. Craig Wesley Carpenter & Scott Loveridge & Maureen Mickus, 2021. "Research note: Age, retirement, and intertemporal resource decision ability," Journal of Consumer Affairs, Wiley Blackwell, vol. 55(2), pages 542-555, June.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Charlotte Cabane & Adrian Hille & Michael Lechner, 2015. "Mozart or Pelé? The Effects of Teenagers' Participation in Music and Sports," SOEPpapers on Multidisciplinary Panel Data Research 749, DIW Berlin, The German Socio-Economic Panel (SOEP).
    2. Beatrice Rammstedt & Frank M. Spinath & David Richter & Jürgen Schupp, 2013. "Personality Changes in Couples: Partnership Longevity and Personality Congruence in Couples," SOEPpapers on Multidisciplinary Panel Data Research 585, DIW Berlin, The German Socio-Economic Panel (SOEP).
    3. Hille, Adrian & Schupp, Jürgen, 2015. "How Learning a Musical Instrument Affects the Development of Skills," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 44, pages 56-82.
    4. Letizia Mencarini & Raffaella Piccarreta & Marco Le Moglie, 2022. "Life‐course perspective on personality traits and fertility with sequence analysis," Journal of the Royal Statistical Society Series A, Royal Statistical Society, vol. 185(3), pages 1344-1369, July.
    5. Jule Specht & Boris Egloff & Stefan C. Schmukle, 2012. "Examining Mechanisms of Personality Maturation: The Impact of Life Satisfaction on the Development of Big Five Personality Traits," SOEPpapers on Multidisciplinary Panel Data Research 455, DIW Berlin, The German Socio-Economic Panel (SOEP).
    6. Chadi, Adrian & Hetschko, Clemens, 2013. "Flexibilisation without hesitation? Temporary contracts and workers' satisfaction," Discussion Papers 2013/3, Free University Berlin, School of Business & Economics.
    7. Lemola, Sakari & Richter, David, 2013. "The Course of Subjective Sleep Quality in Middle and Old Adulthood and Its Relation to Physical Health," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 68(5), pages 721-729.
    8. Cabane, Charlotte & Hille, Adrian & Lechner, Michael, 2016. "Mozart or Pelé? The effects of adolescents' participation in music and sports," Labour Economics, Elsevier, vol. 41(C), pages 90-103.
    9. Schäfer, Konrad C., 2017. "An Investigation Into the Stability of the Big-Five in Germany," Hannover Economic Papers (HEP) dp-600, Leibniz Universität Hannover, Wirtschaftswissenschaftliche Fakultät.
    10. Sarah Dahmann & Silke Anger, 2014. "The Impact of Education on Personality: Evidence from a German High School Reform," SOEPpapers on Multidisciplinary Panel Data Research 658, DIW Berlin, The German Socio-Economic Panel (SOEP).
    11. Jule Specht & Boris Egloff & Stefan C. Schmukle, 2012. "Everything under Control?: The Effects of Age, Gender, and Education on Trajectories of Perceived Control in a Nationally Representative German Sample," SOEPpapers on Multidisciplinary Panel Data Research 445, DIW Berlin, The German Socio-Economic Panel (SOEP).
    12. Jansen, Nora & Hinz, Oliver, 2022. "Inferring opinion leadership from digital footprints," Journal of Business Research, Elsevier, vol. 139(C), pages 1123-1137.
    13. Clemens Hetschko & Andreas Knabe & Ronnie Schöb, 2019. "Looking Back in Anger? Retirement and Unemployment Scarring," Demography, Springer;Population Association of America (PAA), vol. 56(3), pages 1105-1129, June.
    14. Schnitzlein, Daniel D. & Stephani, Jens, 2016. "Locus of Control and low-wage mobility," Journal of Economic Psychology, Elsevier, vol. 53(C), pages 164-177.
    15. Tim Friehe & Mario Mechtel & Markus Pannenberg, 2014. "Positional Income Concerns: Prevalence and Relationship with Personality and Economic Preferences," IAAEU Discussion Papers 201411, Institute of Labour Law and Industrial Relations in the European Union (IAAEU).
    16. Hommelhoff, Sabine & Richter, David, 2017. "Refuting the cliché of the distrustful manager," European Management Journal, Elsevier, vol. 35(2), pages 164-173.
    17. Nikolova, Milena, 2018. "Self-Employment Can Be Good for Your Health," GLO Discussion Paper Series 226, Global Labor Organization (GLO).
    18. Anger, Silke & Camehl, Georg & Peter , Frauke H., 2016. "Job Loss and Changes in Personality - Evidence from Plant Closures," VfS Annual Conference 2016 (Augsburg): Demographic Change 145940, Verein für Socialpolitik / German Economic Association.
    19. Rammstedt, Beatrice & Spinath, Frank M. & Richter, David & Schupp, Jürgen, 2013. "Partnership Longevity and Personality Congruence in Couples," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 54(7), pages 832-835.
    20. Nikolova, Milena & Nikolaev, Boris N., 2021. "Family matters: The effects of parental unemployment in early childhood and adolescence on subjective well-being later in life," Journal of Economic Behavior & Organization, Elsevier, vol. 181(C), pages 312-331.

    More about this item

    Keywords

    Decision-Making; Cognition; Life Course and Developmental Change; Time PreferencesJEL:;
    All these keywords.

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:diw:diwsop:diw_sp974. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Bibliothek (email available below). General contact details of provider: https://edirc.repec.org/data/sodiwde.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.