This paper reports measures of preference parameters relating to risk tolerance, time preference, and intertemporal substitution. These measures are based on survey responses to hypothetical situations constructed using an economic theorist’s concept of the underlying parameters. The individual measures of preference parameters display heterogeneity. Estimated risk tolerance and the elasticity of intertemporal substitution are essentially uncorrelated across individuals. Measured risk tolerance is positively related to risky behaviors, including smoking, drinking, failing to have insurance, and holding stocks rather than Treasury bills.
| Construct | Cites | Category | Questions given? | Content validity | Pretests | Response type | Notes |
|---|---|---|---|---|---|---|---|
| time preference | NEW | yes | no | 2 rounds of pilots | various | ||
| Elasticity of intertemporal substitution | NEW | yes | no | 2 rounds of pilots | various | ||
| Risk Aversion | NEW | yes | no | 2 rounds of pilots | various |
Robert B. Barsky, F. Thomas Juster, Miles S. Kimball, and Matthew D. Shapiro. Preference Parameters and Behavioral Heterogeneity: An Experimental Approach in the Health and Retirement Study. The Quarterly Journal of Economics, 112(2):537–579, May 1997. doi:10.1162/003355397555280.
@article{barsky_preference_1997,
author = {Barsky, Robert B. and Juster, F. Thomas and Kimball, Miles S. and Shapiro, Matthew D.},
doi = {10.1162/003355397555280},
issn = {0033-5533, 1531-4650},
journal = {The Quarterly Journal of Economics},
language = {en},
month = {May},
number = {2},
pages = {537-579},
shorttitle = {Preference {{Parameters}} and {{Behavioral Heterogeneity}}},
title = {Preference {{Parameters}} and {{Behavioral Heterogeneity}}: {{An Experimental Approach}} in the {{Health}} and {{Retirement Study}}},
volume = {112},
year = {1997}
}