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| Content Provider | Springer Nature Link |
|---|---|
| Author | Olivola, Christopher Y. Wang, Stephanie W. |
| Copyright Year | 2015 |
| Abstract | We introduce, test, and compare two auction-based methods for eliciting discount rates. In these “patience auctions”, participants bid the smallest future sum they would prefer -or- the longest time they would wait for a reward, rather than receive a smaller, immediate payoff. The most patient bidder receives the delayed reward; all others receive the immediate payoff. These auctions allow us to compare discounting when participants’ attention is focused on the temporal versus monetary dimension of delayed rewards. We find that the estimated parameters in the three most commonly used discount functions (exponential, hyperbolic, and quasi-hyperbolic) differ across these two bidding methods (time-bids vs. money-bids). Specifically, our participants tend to show more impatience under time-bids. Furthermore, we find that people are more likely to exhibit exponential (as opposed to hyperbolic) discounting and exhibit less present bias under time-bids, compared to money-bids. To our knowledge, this paper is the first to directly compare time versus money preference elicitations, within the same subjects, using an incentive-compatible mechanism. |
| Starting Page | 864 |
| Ending Page | 885 |
| Page Count | 22 |
| File Format | |
| ISSN | 13864157 |
| Journal | Experimental Economics |
| Volume Number | 19 |
| Issue Number | 4 |
| e-ISSN | 15736938 |
| Language | English |
| Publisher | Springer US |
| Publisher Date | 2015-11-04 |
| Publisher Place | New York |
| Access Restriction | One Nation One Subscription (ONOS) |
| Subject Keyword | Delay discounting Preference elicitation Intertemporal choice Within-subject comparison Economic Theory/Quantitative Economics/Mathematical Methods Behavioral/Experimental Economics Microeconomics Game Theory, Economics, Social and Behav. Sciences Operation Research/Decision Theory |
| Content Type | Text |
| Resource Type | Article |
| Subject | Economics, Econometrics and Finance |
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