Is time preference different across incomes and countries?
Is time preference different across incomes and countries?
We offer direct statistical evidence of existing differences in time preference across income classes and countries by estimating and testing an Euler equation for consumption on time series data for six European countries and five income quantiles. We unequivocally reject the hypothesis of homogeneous time preference across countries, whereas heterogeneity across income classes is confirmed to different degrees depending on the country, but with time preference being lowest for the last two quantiles of the income distribution.
De Lipsis, Vincenzo
92ad4463-49f5-412e-b0fc-0a4497767dbe
April 2021
De Lipsis, Vincenzo
92ad4463-49f5-412e-b0fc-0a4497767dbe
Abstract
We offer direct statistical evidence of existing differences in time preference across income classes and countries by estimating and testing an Euler equation for consumption on time series data for six European countries and five income quantiles. We unequivocally reject the hypothesis of homogeneous time preference across countries, whereas heterogeneity across income classes is confirmed to different degrees depending on the country, but with time preference being lowest for the last two quantiles of the income distribution.
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Submitted date: 24 September 2020
Accepted/In Press date: 27 December 2020
e-pub ahead of print date: 7 January 2021
Published date: April 2021
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Local EPrints ID: 455002
URI: http://eprints.soton.ac.uk/id/eprint/455002
ISSN: 0165-1765
PURE UUID: f19aa4d3-e4f2-4723-84ce-0a261efb83e6
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Date deposited: 03 Mar 2022 17:41
Last modified: 17 Mar 2024 04:09
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