Individual Differences in Decision-Making: Evidence for The Scarcity Hypothesis From The English Longitudinal Study of Aging

Abstract

We report the results of a pre-registered analysis of data from the English Longitudinal Study of Aging that was designed to test the hypothesis that economic scarcity is associated with individual differences in decision-making. We tested this hypothesis by comparing time preferences for different socioeconomic groups and in geographical areas ranging from the most deprived to the least deprived in England using the English Indices of Multiple Deprivation. The data supported this hypothesis: People in the most deprived areas were more likely to prefer smaller sooner rewards than people from the least deprived areas. Similarly, people in technical or routine occupations tended to prefer smaller sooner rewards than people in professional or intermediate occupations. In addition, we found that gender, length of education, cognitive function, and subjective social status also predicted time preferences. We discuss these results in the context of theoretical models of scarcity-based models of choice behaviour and decision-making.