Subjective time discount rates among teenagers and adults: Evidence from Israel

Eyal Lahav; Uri Benzion; Tal Shavit

doi:10.1016/j.socec.2010.02.012

Subjective time discount rates among teenagers and adults: Evidence from Israel

Eyal Lahav, Uri Benzion, Tal Shavit

Research output: Contribution to journal › Article › peer-review

22 Scopus citations

Abstract

This study is an empirical examination of the personal discount rates used by teenagers and adults. The participants answered a time-preference questionnaire and were asked about the bank interest paid for deposits. The results demonstrate that teenagers have a very high personal discount rate in comparison to adults. In addition, we found that receiving a regular allowance increases the teenagers'willingness to wait. Our results indicate that the influence of teenagers' poor financial knowledge, which ought to increase the personal discount rate, is stronger than the effect of their safety net that should reduce the personal discount rate.

Original language	English
Pages (from-to)	458-465
Number of pages	8
Journal	Journal of Socio-Economics
Volume	39
Issue number	4
DOIs	https://doi.org/10.1016/j.socec.2010.02.012
State	Published - 1 Aug 2010
Externally published	Yes

Keywords

Cushion effect
Discount rates
Teenagers
Time preference

ASJC Scopus subject areas

Economics and Econometrics

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

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10.1016/j.socec.2010.02.012

Cite this

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title = "Subjective time discount rates among teenagers and adults: Evidence from Israel",

abstract = "This study is an empirical examination of the personal discount rates used by teenagers and adults. The participants answered a time-preference questionnaire and were asked about the bank interest paid for deposits. The results demonstrate that teenagers have a very high personal discount rate in comparison to adults. In addition, we found that receiving a regular allowance increases the teenagers'willingness to wait. Our results indicate that the influence of teenagers' poor financial knowledge, which ought to increase the personal discount rate, is stronger than the effect of their safety net that should reduce the personal discount rate.",

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AU - Shavit, Tal

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AB - This study is an empirical examination of the personal discount rates used by teenagers and adults. The participants answered a time-preference questionnaire and were asked about the bank interest paid for deposits. The results demonstrate that teenagers have a very high personal discount rate in comparison to adults. In addition, we found that receiving a regular allowance increases the teenagers'willingness to wait. Our results indicate that the influence of teenagers' poor financial knowledge, which ought to increase the personal discount rate, is stronger than the effect of their safety net that should reduce the personal discount rate.

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KW - Time preference

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Subjective time discount rates among teenagers and adults: Evidence from Israel

Abstract

Keywords

ASJC Scopus subject areas

UN SDGs

Access to Document

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