Time preference before and after a risky activity - A field experiment

Tal Shavit, Mosi Rosenboim, Yaniv Shani

Research output: Contribution to journalArticlepeer-review

Abstract

This paper examines how a risky activity (e.g., skydiving) affects an individual's time preference related to financial decisions (i.e., wanting to get paid before or after the activity). We found that prior to a risky activity, inexperienced people were more present-oriented, than they were afterwards. Interestingly, the more experienced individuals were, the less likely they were to demonstrate a preference for the present. Our findings suggest that engaging in activities that individuals might find frightening or thrilling (e.g., skydiving; driving faster than the speed limit; going to a mall) could make less experienced actors shortsighted when processing information (considering the present rather than the future), and lead to shortsighted financial decisions. We suggest that the attempt to regulate concerns associated with activities individuals might find frightening affects unrelated, important daily decisions due to a shift in their time preference.

Original languageEnglish
Pages (from-to)30-36
Number of pages7
JournalJournal of Economic Psychology
Volume43
DOIs
StatePublished - Aug 2014

Keywords

  • Discount rates
  • Extreme sports
  • Time and risk Perception
  • Time preference

Fingerprint

Dive into the research topics of 'Time preference before and after a risky activity - A field experiment'. Together they form a unique fingerprint.

Cite this