The Endogenous Determination of Time Preference
Abstract
We model a consumer's efforts to overcome an endowed bias against the future, showing how wealth, mortality, addictions, uncertainty and other variables affect one's ultimate degree of time preference. In addition to working out the implications of our model, we discuss related evidence on consumption, savings, and the dynamics of inequality and how that evidence is related to the predictions of our model.
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Becker, Gary S. and Casey B. Mulligan. "The Endogenous Determination of Time Preference." Quarter Journal of Economics. 112(3), August 1997: 729-58.
© copyright 1996 by Gary S. Becker and Casey B. Mulligan.