Who waits for bigger rewards, and do discounting scores agree?
Four different ways of scoring impatience for money all agreed closely, and people who chose to wait tended to have higher intelligence, better executive function and a stronger focus on the future.
Source
Four converging measures of temporal discounting and their relationships with intelligence, executive functions, thinking dispositions, and behavioral outcomes
Study at a glance
- Design
- Cross-sectional — Single-session individual-differences study: a staircase task of hypothetical now-vs-later money choices (delays from 1 month to 25 years; $100 and $10,000 amounts), plus intelligence, executive-function tests and questionnaires, analysed with repeated-measures ANOVA, curve fitting, correlations and hierarchical regression.
- N
- N=99 · 99 undergraduate students tested individually.
- Population
- Undergraduate students at a Canadian university, aged 18 to 30.
- Outcome
- Temporal discounting scored four ways (k-value, area under the curve, indifference point, interest-rate total score), choice reaction times, and correlations with IQ, an executive-function composite, Need for Cognition, Consideration of Future Consequences and a drug/gambling problem composite.
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What they did
University students made a series of hypothetical choices between a smaller amount of money now and a fixed larger amount later, across delays from 1 month to 25 years and for two reward sizes ($100 and $10,000). The authors scored these choices four ways, including a new 'interest rate' score that only counts items where waiting clearly pays off (at least a 40% annual return). Students also completed IQ subtests, Stroop, Trail Making and a serial-addition working-memory task, two thinking-disposition scales, and questions about gambling, alcohol and drug problems.
What they found
People discounted more as delays lengthened and less for the larger reward, and a hyperbolic curve fit the choices better than an exponential one (for example, 79.50% vs 73.48% of variance at $100). Decisions took longer at the indifference point, where preference switched from now to later. All four scores were strongly intercorrelated, and choosing to wait was linked to higher intelligence, better executive function and more Consideration of Future Consequences; in a regression, future-consequences thinking explained variance beyond intelligence and executive function. Links with drug, alcohol and gambling problems were weak, with only the indifference point reaching significance.
The limits
What it doesn't show
All choices were hypothetical, so the study cannot show how people would behave with real money. The sample was a modest group of university students with few gambling or substance problems, which limits conclusions about clinical or real-world risk behaviour, and the authors call for larger samples. The data are correlational, so they do not show that intelligence or future orientation causes patience, and three of the four discounting scores were badly skewed, limiting which statistics could be used.
Key terms
- Temporal (delay) discounting
- The tendency to value a reward less the further in the future it will arrive.
- Indifference point
- The immediate amount at which a person switches from preferring the later reward to preferring the immediate one; the subjective present value of the delayed reward.
- k-value
- A fitted parameter from the hyperbolic discounting equation; larger k means steeper discounting and greater impatience.
- Area under the curve
- A model-free discounting index computed from normalised indifference points; values near 1 mean little discounting and near 0 mean steep discounting.
- Hyperbolic discounting
- A pattern where value drops steeply over short delays and then levels off, rather than falling at a constant rate as in exponential discounting.
- Consideration of Future Consequences
- A self-report trait capturing how much people weigh distant outcomes when deciding what to do now.
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Quiz yourself
A large k-value in hyperbolic discounting indicates what?
Common questions
Why create a fourth score when three already exist?
The usual scores treat every waiting choice as equivalent; the interest-rate score only credits waiting when the return is clearly worth it, so it separates good from poor decisions.
Why did the authors mostly use the indifference point in their main analyses?
It was the only discounting score that was normally distributed, making it suitable for parametric tests such as repeated-measures ANOVA and regression.
Why were the links with gambling and drug problems so weak?
The students reported very few such problems, so there was little variation in risky behaviour for discounting to predict.
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