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Individual Time Preferences for Well-Being Allocation between Present and Future Generations
Despite the utopian nature of communist societies of the 20th century, the public legitimacy of temporarily sacrificing the current prosperity for the sake of a better future remains a notable characteristic of a society’s potential for modernization. The study focuses on measuring individual discount rates for reallocation of two experimental types of non-market merit goods in favor of future generations – ‘saved human lives’ and ‘healthy and prosperous life-years’.
If in the case of ‘saved human lives’ the experimental situation inherits the logic of similar foreign research, then in the case of ‘healthy and prosperous life-years’ an experimental situation departs from the theoretical foundations of similar foreign approaches, which, as a rule, use the category of ‘healthy life-years’ to solve problems in the field of healthcare economics. In our case, the experimental situation is a kind of input data for choosing the individual political and economic decision about the price at which additional current well-being might be allocated for the sake of the future generations. In particular, it provides an analysis of intertemporal choice when respondents vote for one of two programs: the first one, with a ‘rentier effect’, provides the society with the above-mentioned goods immediately, but does not impact the well-being of future generations, while the second one requires a rejection of additional prosperity in the present and postpones access to those goods for several decades, but eventually allows the society to receive the goods in bigger amounts or for a longer period of time.
It is shown that the discount rates for the good ‘saved human lives’ in Russia are higher than for Europe and the USA in similar experiments and amount to 20.4% and 11.8% for time periods of 25 and 50 years, respectively. Discount rates were calculated for the experimental good ‘prosperous life-years’ (6.1% and 3.9% for the same time periods). At the same time, it is shown that the share of respondents who prefer present-oriented programs (the distribution of benefits in favor of those living today) for Russia exceeds 75-80%. The main motives of the mass orientation towards the redistribution of benefits in favor of the present, rather than future generations, are identified, among which the main ones are the factor of the current standard of living, the limited forecast horizon, the principle of generational self-responsibility, the scientific and technological revolution factor and the “time loop” factor.