Adolescent Time Preferences Predict Lifetime Outcomes

23 Pages Posted: 8 Nov 2014

See all articles by Bart Golsteyn

Bart Golsteyn

Maastricht University - Research Centre for Education and the Labour Market (ROA); IZA Institute of Labor Economics; Stockholm University - Swedish Institute for Social Research (SOFI)

Hans Grönqvist

Stockholm University

Lena Lindahl

Stockholm University - Faculty of Social Sciences

Date Written: November 2014

Abstract

This study investigates the relationship between time preferences and lifetime social and economic outcomes. We use a Swedish longitudinal data set that links information from a large survey on children's time preferences at age 13 to administrative registers spanning over five decades. Our results indicate a substantial adverse relationship between high discount rates and school performance, health, labour supply and lifetime income. Males and high‐ability children gain significantly more from being future oriented. These discrepancies are largest regarding outcomes later in life. We also show that the relationship between time preferences and long‐run outcomes operates through early human capital investments.

Suggested Citation

Golsteyn, Bart and Grönqvist, Hans and Lindahl, Lena, Adolescent Time Preferences Predict Lifetime Outcomes (November 2014). Feature Issue, Vol. 124, Issue 580, pp. F739-F761, 2014. Available at SSRN: https://ssrn.com/abstract=2520683 or http://dx.doi.org/10.1111/ecoj.12095

Bart Golsteyn (Contact Author)

Maastricht University - Research Centre for Education and the Labour Market (ROA) ( email )

P.O. Box 616
Maastricht, MD6200
Netherlands

IZA Institute of Labor Economics

P.O. Box 7240
Bonn, D-53072
Germany

Stockholm University - Swedish Institute for Social Research (SOFI) ( email )

Kyrkgatan 43B
SE-106 91 Stockholm
Sweden

Hans Grönqvist

Stockholm University

Universitetsvägen 10
Stockholm, SE-106 91
Sweden

Lena Lindahl

Stockholm University - Faculty of Social Sciences ( email )

SE-106 91 Stockholm
Sweden

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