Individual Laboratory-Measured Discount Rates Predict Field Behavior

Christopher F. Chabris, David Laibson, Carrie L. Morris, Jonathon P. Schuldt and Dmitry Taubinsky

No 14270, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We estimate discount rates of 555 subjects using a laboratory task and find that these individual discount rates predict inter-individual variation in field behaviors (e.g., exercise, BMI, smoking). The correlation between the discount rate and each field behavior is small: none exceeds 0.28 and many are near 0. However, the discount rate has at least as much predictive power as any variable in our dataset (e.g., sex, age, education). The correlation between the discount rate and field behavior rises when field behaviors are aggregated: these correlations range from 0.09-0.38. We present a model that explains why specific intertemporal choice behaviors are only weakly correlated with discount rates, even though discount rates robustly predict aggregates of intertemporal decisions.

JEL-codes: C91 D9 I1 (search for similar items in EconPapers)
Date: 2008-08
New Economics Papers: this item is included in nep-exp
Note: AG EH
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Citations: View citations in EconPapers (254)

Published as Christopher Chabris & David Laibson & Carrie Morris & Jonathon Schuldt & Dmitry Taubinsky, 2008. "Individual laboratory-measured discount rates predict field behavior," Journal of Risk and Uncertainty, Springer, vol. 37(2), pages 237-269, December.

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Journal Article: Individual laboratory-measured discount rates predict field behavior (2008)
Working Paper: Individual Laboratory-Measured Discount Rates Predict Field Behavior (2008)
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