Working Paper: NBER ID: w17483
Authors: Charles J. Courtemanche; Garth Heutel; Patrick McAlvanah
Abstract: This paper explores the relationship between time preferences, economic incentives, and body mass index (BMI). Using data from the 1979 cohort of the National Longitudinal Survey of Youth, we first show that greater impatience increases BMI even after controlling for demographic, human capital, and occupational characteristics as well as income and risk preference. Next, we provide evidence of an interaction effect between time preference and food prices, with cheaper food leading to the largest weight gains among those exhibiting the most impatience. The interaction of changing economic incentives with heterogeneous discounting may help explain why increases in BMI have been concentrated amongst the right tail of the distribution, where the health consequences are especially severe. Lastly, we model time-inconsistent preferences by computing individuals'quasi-hyperbolic discounting parameters (β and δ). Both long-run patience (δ) and present-bias (β) predict BMI, suggesting obesity is partly attributable to rational intertemporal tradeoffs but also partly to time inconsistency.
Keywords: obesity; time preferences; economic incentives; body mass index; NLSY
JEL Codes: D91; I10
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| greater impatience (E41) | higher BMI (I12) |
| lower food prices (Q11) | larger weight gains among individuals with higher impatience (D15) |
| time preference (moderator) + lower food prices (D11) | higher BMI (I12) |
| long-run patience + present bias (D15) | BMI (I12) |
| one standard deviation increase in discount factor (D15) | reduction in BMI (I14) |