How to measure time preferences: An experimental comparison of three methods

Abstract

In two studies, time preferences for financial gains and losses at delays of up to 50 years were elicited using three different methods: matching, fixed-sequence choice titration, and a dynamic "staircase" choice method. Matching is found to create fewer demand characteristics and to produce better fits with the hyperbolic model of discounting. The choice-based measures are shown to better predict real-world outcomes such as smoking and payment of credit card debt. No consistent advantages are found for the dynamic staircase method over fixed-sequence titration. © 2013. The authors license this article under the terms of the Creative Commons Attribution 3.0 License.