Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/258908 
Year of Publication: 
2019
Series/Report no.: 
CEBI Working Paper Series No. 08/19
Publisher: 
University of Copenhagen, Department of Economics, Center for Economic Behavior and Inequality (CEBI), Copenhagen
Abstract: 
This paper documents a large association between individuals' time discounting in incentivized experiments and their positions in the real-life wealth distribution derived from Danish high-quality administrative data for a large sample of middle-aged individuals. The association is stable over time, exists through the wealth distribution and remains large after controlling for education, income profile, school grades, initial wealth, parental wealth, credit constraints, demographics, risk preferences and additional behavioral parameters. Our results suggest that savings behavior is a driver of the observed association between patience and wealth inequality as predicted by standard savings theory.
Subjects: 
Wealth inequality
savings behavior
time discounting
experimental methods
administrative data
JEL: 
C91
D15
D31
E21
Document Type: 
Working Paper

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