Monday, March 17
Tom Vogl: Differential Fertility, Human Capital, & Development
Chu, C. Y. Cyrus, Hung-Ken Chien, and Ron Lee. 2010. "The evolutionary theory of time preferences and intergenerational transfers." Journal of Economic Behavior & Organization, 76(3): 451-464.
At each age an organism produces energy by foraging and allocates this energy among reproduction, survival, growth, and intergenerational transfers. We characterize the optimal set of allocation decisions that maximizes fitness. Time preference (the discount rate) is derived from the marginal rate of substitution between energy obtained at two different times or ages, holding fitness constant. Time preference varies with age in different ways depending on whether an individual is immature or mature, and during the transition between these stages. We conclude that time preference and discount rates are likely to be U-shaped across age. (C) 2010 Elsevier B.V. All rights reserved.
PMCID: PMC3014627. (Pub Med Central)