How Time Preferences Differ: Evidence from 45 Countries
WHU - Otto Beisheim School of Management
Marc Oliver Rieger
University of Trier
University of Zurich - Department of Banking and Finance; Norwegian School of Economics and Business Administration (NHH); Swiss Finance Institute (Zurich Center)
January 25, 2010
Swiss Finance Institute Research Paper No. 09-47
We present results from the first large-scale international survey on time discounting, conducted in 45 countries. Cross-country varia- tion cannot simply be explained by economic variables such as interest rates or inflation. In particular, we find strong evidence for cultural differences, as measured by the Hofstede cultural dimensions. For ex- ample, high levels of Uncertainty Avoidance or Individualism are both associated with strong hyperbolic discounting. Moreover, as applica- tion of our data, we find evidence for an impact of time preferences on the capability of technological innovations in a country and on environmental protection.
Number of Pages in PDF File: 55
Keywords: Intertemporal decision, Endogenous preference, Cross-cultural comparison
JEL Classification: D90, F40
Date posted: October 4, 2009 ; Last revised: July 14, 2011
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