Time discounting and smoking behavior: evidence from a panel survey(*)

Area of Science:

• Behavioral Economics
• Public Health
• Psychology

Background:

• Time discounting, the tendency to devalue future rewards, is a key factor in self-control problems.
• Biases in time discounting, such as hyperbolic discounting and the sign effect, may influence addictive behaviors like smoking.

Purpose of the Study:

• To investigate the association between personal time discounting, its biases, and smoking behavior in Japanese adults.
• To differentiate the impact of time-discounting variables on smoking participation versus cigarette consumption.

Main Methods:

• Utilized a panel survey of Japanese adults to collect data on smoking behavior and time preferences.
• Employed Cragg's two-part model to estimate smoking participation and cigarette consumption.
• Analyzed the over-time instability of elicited discount rates using panel data.

Main Results:

• Smoking behavior positively correlates with the discount rate and hyperbolic discounting, and negatively with the sign effect.
• Hyperbolic discounting significantly impacts smoking participation, especially for 'naïve' individuals unaware of self-control issues.
• Discount rate, sign effect, and a procrastination-based proxy for hyperbolic discounting influence both smoking participation and consumption.

Conclusions:

• Time preferences and their biases are significant predictors of smoking behavior, with distinct variables influencing participation and consumption.
• Instability in discount rates stems from measurement error, not preference shocks.
• The observed associations between time preferences and smoking are primarily interpersonal.