Guy is a Research Fellow at the IFS and was involved with the Mirrlees Review of the UK tax system. He is also a Professor at Sciences Po and at University College London. Guy is head of the Macroeconomics Laboratory at CREST, the research centre of the French statistical agency INSEE. His research revolves around macroeconomic issues, with contributions to theory, econometric techniques and applications.
Discount rate heterogeneity among older households: a puzzle?
| Journal Articles
We put forward a method for estimating discount rates using wealth and income data. We build consumption from these data using the budget constraint. Consumption transitions yield discount rates by household groups. Applying this technique to a sample of older households, we find a similar distribution to those previously estimated using field data, though with a much lower mean than those found using experiments. Surprisingly, among this older population, patience is negatively correlated with education and numeracy. This goes against the positive correlation found for younger populations in experiments and some field studies. We discuss potential explanations for this result.