On Measuring Time Preferences
Eliciting time preferences has become an important component of both laboratory and field experiments, yet there is no consensus as how to best measure discounting. We examine the predictive validity of two recent, simple, easily administered, and individually successful elicitation tools: Convex Time Budgets (CTB) and Double Multiple Price Lists (DMPL). Using similar methods, the CTB and DMPL are compared using within- and out-of-sample predictions. While each perform equally well within sample, the CTB significantly outperforms the DMPL on out-of-sample measures.
We thank Steffen Andersen and, especially, Glenn Harrison for the generous comments which greatly improved the quality of this research. We are also grateful to the National Science Foundation, grant SES-0962484 (Andreoni) and grant SES-1024683 (Andreoni and Sprenger) for financial support. The views expressed herein are those of the authors and do not necessarily reflect the views of the National Bureau of Economic Research.
Journal of Economic Behavior & Organization Volume 116, August 2015, Pages 451–464 Cover image Measuring time preferences: A comparison of experimental methods ☆ James Andreonia, , Michael A. Kuhnb, , Charles Sprengerc, ,