Artikel

PRUDENT DISCOUNTING: EXPERIMENTAL EVIDENCE ON HIGHER ORDER TIME RISK PREFERENCES

We report results from an experiment that contrasts preferences toward the risk of what may happen (outcome risk preferences) with preferences toward the risk of when something may happen (time or delay risk preferences). Just as choices over monetary risks identify utility independently from discounting, choices over uncertain delays of a fixed reward identify discounting independently from utility. We replicate the widespread finding of outcome risk aversion, but—in a perfectly symmetric design—find substantial heterogeneity in delay risk aversion. Going beyond the second order of risk aversion, on the other hand, yields pervasive evidence for delay prudence and outcome prudence alike. This first empirical support for prudent discounting speaks to recent theoretical arguments that prudence may be a more important trait than previously realized.

Sprache
Englisch

Erschienen in
Journal: International Economic Review ; ISSN: 1468-2354 ; Volume: 62 ; Year: 2021 ; Issue: 4 ; Pages: 1489-1511

Klassifikation
Wirtschaft

Ereignis
Geistige Schöpfung
(wer)
Ebert, Sebastian
Ereignis
Veröffentlichung
(wer)
Wiley
(wo)
Hoboken, NJ
(wann)
2021

DOI
doi:10.1111/iere.12521
Handle
Letzte Aktualisierung
10.03.2025, 11:44 MEZ

Datenpartner

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Objekttyp

  • Artikel

Beteiligte

  • Ebert, Sebastian
  • Wiley

Entstanden

  • 2021

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