Discrete choice estimation of time preferences

Jose Apesteguia and Miguel Ballester

Economics Working Papers from Department of Economics and Business, Universitat Pompeu Fabra

Abstract: Discrete choice methods are often used for the estimation of time preferences. We show that these methods have pervasive problems when based on random utility models, for which cases our results establish that the probability of selecting a later option over an earlier one may be greater for higher levels of impatience. This could have profound implications, not only in the experimental estimation of time preferences, but also in a wide variety of empirical papers using such models in dynamic settings. Alternatively, we also show that discrete choice methods built on random preference models are always free of all such problems.

Keywords: Discrete Choice; Structural Estimation; Time; Discounting; Random Utility Models; Random Preference Models. (search for similar items in EconPapers)
JEL-codes: C25 D90 (search for similar items in EconPapers)
Date: 2014-08
New Economics Papers: this item is included in nep-dcm, nep-ecm and nep-upt
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Related works:
Working Paper: Discrete Choice Estimation of Time Preferences (2015)
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Persistent link: https://EconPapers.repec.org/RePEc:upf:upfgen:1442

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