Eliciting Individual Discount Rates

被引:29
|
作者
Maribeth Coller
Melonie B. Williams
机构
[1] University of South Carolina,School of Accounting, The Darla Moore School of Business
[2] U. S. EPA,undefined
[3] Office of Policy,undefined
关键词
experimental economics; discount rates; censored dependent variable;
D O I
10.1023/A:1009986005690
中图分类号
学科分类号
摘要
Controlled laboratory conditions using monetary incentives have been utilized in previous studies that examine individual discount rates, and researchers have found several apparently robust anomalies. We conjecture that subject behavior in these experiments may be affected by (uncontrolled) factors other than discount rates. We address some experimental design issues and report a new series of experiments designed to elicit individual discount rates. Our primary treatments include: (i) informing subjects of the annual and effective interest rates associated with alternative payment streams, and (ii) informing subjects of current market interest rates. We also test for the effect of real (vs. hypothetical) payments and for the effect of delaying both payment options (vs. offering an immediate payment option). The statistical analysis uses censored data techniques to account for the interactions between field and lab incentives. Each of the information treatments appears to reduce revealed discount rates. When both types of information are provided, annual rates in the interval of 15%–17.5% are revealed, whereas rates of 20%–25% are revealed in the control session. Each of the treatments also lowers the residual variance of subject responses.
引用
收藏
页码:107 / 127
页数:20
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