Is Discounting the Future Due to a Defect in Impulse Control, Or a Rational Adaptation?

Many people are familiar with the Mischel marshmallow experiment. Kids who delayed gratification had better life outcomes.* The concept of varying ability to delay gratification is quite critical to discussions of public policy, since clearly we do not all have identical agency in every situation, by reason of variation of our nervous systems.

The received wisdom in the informed public is that not delaying gratification - that is, discounting the future - is a negative, a deficit in impulse control. The experiment has been run in multiple settings with the discount rate quantified: do you accept a ten dollar payment at the conclusion of your participation, or $11 a month later? (If you take the $10 right now, your future discounting rate is 10% per month.) It's been pointed out repeatedly since then that there are many other plausibly influential factors, including the predictability of the environment. Run this study in Singapore, and you can count on the experimenter being in their office when you go back. In Somalia, after a month, who knows if the building will be there anymore? Whether it's war or just low trust that makes it less likely you'll actually get your payoff, the direction of the impact on your discount rate is going to be the same.

Celeste Kidd created a model of this in children, and sure enough, kids who were disappointed by not receiving a promised reward, later on discounted the future significantly more. This relates to future discount rates in politically unstable parts of the world, as well as in children raised by inconsistent parents. It's a vicious cycle, because increasing your discounting is actual the rational choice.

I would have expected this result to be much better known, so I'm doing my small part in making that happen.

Kidd C, Palmeri H, Aslin RN. Rational snacking: Young children’s decision-making on the marshmallow task is moderated by beliefs about environmental reliability. Cognition. Volume 126, Issue 1, January 2013, Pages 109-114.


*It's worth pointing out that, so far as I know, there's no research showing that low future discounting increases happiness - in fact, there's research strongly suggesting that the curve is U-shaped, and beyond a certain point, good impulse control makes us less happy! Isn't that why we care? Essentially longitudinal studies here and here; writeup of both in Washington Post. Of course, your country is affected by the level of impulse control of your countrymen, so the ideal situation might be to be a person with low impulse control in a country of people with high impulse control, a classic free-rider problem.