(Im)Patience Among Adolescents: A Methodological Note

16 Pages Posted: 12 Jul 2011  

Catherine C. Eckel

Texas A&M University

Philip J. Grossman

Monash University - Department of Economics

Cathleen A. Johnson

University of Arizona, Philosophy, Politics, Economics and Law Program; Center for Interuniversity Research and Analysis on Organization (CIRANO)

Angela C. M. de Oliveira

University of Massachusetts Amherst

Christian Rojas

University of Massachusetts at Amherst - College of Natural Resources & the Environment - Department of Resource Economics

Rick K. Wilson

Rice University - Department of Political Science

Date Written: August 18, 2010

Abstract

Time preference is a fundamental component of many economic models and questions of interest. Yet, elicited preferences are frequently questioned on the grounds of potentially confounding elements of the experimental design, such as trust in the experimenter. We report on a time preference experiment using a sample of 490 high school students from Houston, TX and St. Cloud, MN. We find no relationship between confidence in receiving payment from the experimenters and the intertemporal allocation decisions. However, we find an illogical result for this population: reverse hyperbolic discounting. On aggregate the students are more likely to be impatient as choices are moved further into the future. However, this aggregate result is driven by heterogeneity in the home environment: For a subset of our population, elicited time preferences reflect increasing impatience as the decisions are farther in the future: These individuals come from home environments with factors that decrease the likelihood that they will receive the later payments. Once this heterogeneity is accounted for, the population is, on average, exponentially discounting. Results indicate that caution is warranted when trying to generalize results based on the convenience sample of university undergraduates to other populations. Further, results highlight the importance of accounting for preference heterogeneity within and across samples.

Keywords: Time preference, Field experiment, Teen

JEL Classification: C93, D91

Suggested Citation

Eckel, Catherine C. and Grossman, Philip J. and Johnson, Cathleen A. and de Oliveira, Angela C. M. and Rojas, Christian and Wilson, Rick K., (Im)Patience Among Adolescents: A Methodological Note (August 18, 2010). Available at SSRN: https://ssrn.com/abstract=1883745 or http://dx.doi.org/10.2139/ssrn.1883745

Catherine C. Eckel (Contact Author)

Texas A&M University ( email )

5201 University Blvd.
College Station, TX 77843-4228
United States

Philip J. Grossman

Monash University - Department of Economics ( email )

Wellington Road
Clayton, 3800
Australia
61399020052 (Phone)

Cathleen Amanda Johnson

University of Arizona, Philosophy, Politics, Economics and Law Program ( email )

Social and Behavioral Sciences
Tucson, AZ 85721-0108
United States

Center for Interuniversity Research and Analysis on Organization (CIRANO)

Montreal, Quebec H3C 3J7
Canada

Angela C. M. De Oliveira

University of Massachusetts Amherst ( email )

Department of Operations and Information Managemen
Amherst, MA 01003
United States

HOME PAGE: http://www.umass.edu/resec/faculty/deoliveira/index.shtml

Christian Rojas

University of Massachusetts at Amherst - College of Natural Resources & the Environment - Department of Resource Economics ( email )

Stockbridge Hall
80 Campus Center Way
Amherst, MA 01003-9246
United States

Rick K. Wilson

Rice University - Department of Political Science ( email )

Houston, TX 77005-1892
United States

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