Intertemporal Choice Experiments and Large-Stakes Behavior

Serie

  • Documentos de trabajo - Alianza EFI

Resumen

  • Intertemporal choice experiments are frequently implemented to make inference about time preferences, yet little is known about the predictive power of resulting measures. This project links standard experimental choices to a decision on the desire to smooth a large-stakes payment — around 10% of annual income — through time. In a sample of around 400 Guatemalan Conditional Cash Transfer recipients, we find that preferences over large-stakes payment plans are closely predicted by experimental measures of patience and diminishing marginal utility. These represent the first findings in the literature on the predictive content of experimentally elicited intertemporal preferences for large-stakes decisions.Q

fecha de publicación

  • 2019

Líneas de investigación

  • Convex Time Budget
  • Discounting
  • Out-of-sample prediction
  • Structural estimation

Issue

  • 18985