Great Expectations

Driven by research highlighting links between the personal discount rate and both health and financial behaviours this study investigates a potential link between the personal discount rate and subjective wellbeing. Recent research in to the discount rate has found links between this construct and domains critical for subjective wellbeing but as yet the direct relationship with overall subjective wellbeing remains untested. This link is investigated in a nationally representative survey of 2000 people in the UK that included an aggregate measure of the discount rate, several measures of subjective wellbeing and other control variables, both demographic and social. Multiple regression analysis indicates that the extent to which people devalue future rewards is negatively correlated with evaluative wellbeing. The same but weaker correlation is found for the discount rate and hedonic wellbeing. The analysis also revealed that greater discounts on future rewards are associated with higher expected future life satisfaction. This leaves the archetypal high discounter being less likely to be satisfied with their life now but more likely to expect significant improvements in life satisfaction in the future.