An investigation on domain specific social time preference rates in Singapore

Abstract

Social discount rates (SDR) is the rate at which society is willing to forgo a unit of current consumption for future consumption. The social time preference rate approach to eliciting SDR has been adopted by many countries. Yet, there is limited research on SDR in Singapore. This paper seeks to address this gap by eliciting social time preference rates (STPR) in Singapore in three domains: environment, health and money by conducting Discrete Choice Experiments with 284 respondents. It is observed that STPR for money is consistently higher than that in the health domain. STPR for the environmental domain could not be obtained due to insignificant estimates. The STPR elicited are as follows: money (2 year: 14.2%, 4 year: 19.1%, 6 year: 18.0%); health (2 year: 9.2%, 4 year: 14.4%, 6 year: 13.4%). Generally, results fall within the range of stated preference STPR elicited in past literature. However, patterns exhibited cannot be explained by conventional discounting models. The initial increase in impatience amongst respondents followed by patience over time demonstrates that Singaporeans may be more attuned towards short term policies and are willing to wait for long term benefits. Personal characteristic and domain specific knowledge, attitude and practices framework (KAP) questions are further interacted with delay and improvements to explore their influence on STPR.