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Patience and long-run growth

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  • Hübner, Malte
  • Vannoorenberghe, Gonzague

Abstract

Complementing research on the effect of patience on individual behavior, we present empirical evidence that patience is an important determinant of long-run income differences between countries. To account for a potential endogeneity bias, we instrument patience by information on how languages spoken in the countries of our sample require speakers to encode time. The economic impact of patience and growth is sizable. Our results suggest that increasing patience by one standard deviation raises per-capita income by between 34% and 78%.

Suggested Citation

  • Hübner, Malte & Vannoorenberghe, Gonzague, 2015. "Patience and long-run growth," MPRA Paper 65553, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:65553
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    Cited by:

    1. Mikhail Pakhnin, 2021. "Collective Choice with Heterogeneous Time Preferences," CESifo Working Paper Series 9141, CESifo.
    2. Armin Falk & Fabian Kosse & Pia Pinger & Hannah Schildberg-Hörisch & Thomas Deckers, 2021. "Socioeconomic Status and Inequalities in Children’s IQ and Economic Preferences," Journal of Political Economy, University of Chicago Press, vol. 129(9), pages 2504-2545.
    3. Oasis Kodila‐Tedika & Sherif Khalifa, 2020. "Long‐term vision and economic development," The World Economy, Wiley Blackwell, vol. 43(11), pages 3088-3102, November.
    4. Tetsugen Haruyama & Ken-ichi Hashimoto, 2020. "Innovators and imitators in a world economy," Journal of Economics, Springer, vol. 130(2), pages 157-186, July.
    5. Kirill Borissov & Stefano Bosi & Thai Ha-Huy & Leonor Modesto, 2017. "Heterogeneous Human Capital, Inequality and Growth: The Role of Patience and Skills," EUSP Department of Economics Working Paper Series 2017/03, European University at St. Petersburg, Department of Economics.
    6. Paul Shea, 2019. "The Macroeconomics of Pascal’s Wager," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 45(4), pages 481-496, October.
    7. Gordon, Elizabeth A. & Gotti, Giorgio & Ho, Joanna H. & Mora, Araceli & Morris, Richard D., 2019. "Commentary: Where is International Accounting Research Going? Issues Needing Further Investigation," Journal of International Accounting, Auditing and Taxation, Elsevier, vol. 37(C).
    8. Anna Valero, 2021. "Education and economic growth," CEP Discussion Papers dp1764, Centre for Economic Performance, LSE.
    9. Sivropoulos-Valero, Anna Alexandra, 2021. "Education and economic growth," LSE Research Online Documents on Economics 114434, London School of Economics and Political Science, LSE Library.
    10. Balart, Pau & Oosterveen, Matthijs & Webbink, Dinand, 2018. "Test scores, noncognitive skills and economic growth," Economics of Education Review, Elsevier, vol. 63(C), pages 134-153.
    11. Anna Valero, 2021. "Education and economic growth," POID Working Papers 006, Centre for Economic Performance, LSE.
    12. Hübner, Malte & Vannoorenberghe, Gonzague, 2015. "Patience and Inflation," MPRA Paper 65811, University Library of Munich, Germany.
    13. Borissov, K. & Pakhnin, M., 2018. "A Division of Society into the Rich and the Poor: Some Approaches to Modeling," Journal of the New Economic Association, New Economic Association, vol. 40(4), pages 32-59.
    14. Borissov, Kirill & Bosi, Stefano & Ha-Huy, Thai & Modesto, Leonor, 2016. "Inequality and Growth: The Role of Human Capital with Heterogeneous Skills," IZA Discussion Papers 10090, Institute of Labor Economics (IZA).
    15. Florens Pfann & Gerard Pfann, 2024. "Can trust explain patience? A cross-country analysis," French Stata Users' Group Meetings 2024 02, Stata Users Group.
    16. Chen, Josie I. & He, Tai-Sen & Riyanto, Yohanes E., 2019. "The effect of language on economic behavior: Examining the causal link between future tense and time preference in the lab," European Economic Review, Elsevier, vol. 120(C).
    17. Effrosyni Adamopoulou & Mattia Colombo & Eleftheria Triviza, 2024. "Early Life Conditions, Time Preferences, and Savings," CRC TR 224 Discussion Paper Series crctr224_2024_583, University of Bonn and University of Mannheim, Germany.
    18. Essl, Andrea & Suter, Manuel & von Bieberstein, Frauke, 2023. "The effect of future-time referencing on pro-environmental behavior," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 107(C).

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    More about this item

    Keywords

    long-run growth; time-preferences; patience;
    All these keywords.

    JEL classification:

    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • E03 - Macroeconomics and Monetary Economics - - General - - - Behavioral Macroeconomics
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • Z13 - Other Special Topics - - Cultural Economics - - - Economic Sociology; Economic Anthropology; Language; Social and Economic Stratification

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