Are the poor more impatient than the rich? Experimental evidence on the effect of (lab) wealth on intertemporal preferences

Poor people have, on average, a higher marginal propensity to consume. One (out of many) possible explanations for this is that poverty affects impatience. This would have important implications for monetary and fiscal policy. While some macroeconomists simply assume lower individual discount factors for poorer households, little is known about this phenomenon from a behavioural point of view. This paper presents a laboratory experiment to test whether the poor show more impatient behaviour. In the experiment, half of the participants gets a high participation fee, while the other half gets a low participation fee. All participants perform an intertemporal multiple price list task. The participation fee has a significant effect. Surprisingly, participants with a lower participation fee are less impatient.