Arbeitspapier
Are the poor so present-biased?
Estimates of "present-bias" among the poor may be exaggerated if poor individuals are credit-constrained and expect to have greater liquidity in the future. I conduct an experiment in rural Pakistan which provides causal evidence of this effect. I use windfalls to generate fully exogenous variation in subjects' liquidity constraints. I show that fluctuating liquidity has a signifi cant and sizeable effect on measures of time-inconsistency, which does not operate via cognitive functioning. Importantly, I establish that the causation runs from tighter liquidity constraints to appearing "present-biased" rather than truly present-biased individuals making choices which lead to tighter liquidity constraints.
- Language
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Englisch
- Bibliographic citation
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Series: IFS Working Papers ; No. W18/24
- Classification
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Wirtschaft
- Event
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Geistige Schöpfung
- (who)
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Cassidy, Rachel
- Event
-
Veröffentlichung
- (who)
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Institute for Fiscal Studies (IFS)
- (where)
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London
- (when)
-
2018
- Handle
- Last update
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10.03.2025, 11:43 AM CET
Data provider
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. If you have any questions about the object, please contact the data provider.
Object type
- Arbeitspapier
Associated
- Cassidy, Rachel
- Institute for Fiscal Studies (IFS)
Time of origin
- 2018
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