Q2. What have the authors stated for future works in "Time preferences and career investments" ?
A potential explanation for this inconsistency is that the authors use a different patience measure: whereas previous studies rely on behavioural proxies ( e. g., smoking and alcohol consumption ), they exploit a battery of items indicating the individual ’ s orientation towards the future. The authors test this explanation by re-estimating their models using a patience measure based on behavioural proxies. Future research could exploit more general ( self-assessed ) psychological constructs such as the CFC scale. The results complement recent findings in economics showing that time preferences predict the individual ’ s income level ( Golsteyn et al., 2014 ; Cadena and Keys, forthcoming ), suggesting observed income inequality can to some extent be explained by heterogeneity in the discount rate.
Q3. What are the common methods of searching for a job?
Answering advertisements, directly contacting employers and asking friends and relatives are frequentlyused job search methods as well.
Q4. What is the effect of a higher level of work effort on the job acceptance rate?
A higher level of search effort results in a positive effect on the job arrival rate,whereas an increase in the level of work effort generates a negative effect on thejob acceptance rate (1 − F(ŵ)).
Q5. How does Cadena and Keys (forthcoming) show that impatience negatively?
Cadena and Keys (forthcoming) also demonstrate that impatience is negatively related to school performance and thereby depresses lifetime income: the earnings gap between ‘impatient’ and ‘patient’ individuals is over $75.000 by the time they reach middle age.
Q6. Why do workers who just (re)entered the labour market have rather distinctive job search behaviour?
The rationale is that workers who just (re)entered the labour market may have rather distinctive job search behaviour, as they may for instance accept a job that they perceive as temporary.
Q7. What is the role of job search in the wage formation of unemployed workers?
Although promotions and job mobility are typically studied in isolation, recent literature stresses that on-the-job search may play an important role in the wage formation of workers staying in the firm (e.g., Cahuc et al., 2006; Postel-Vinay and Turon, 2010; Moen and Rosen, 2013).
Q8. What does the model show about the relationship between patience and work effort?
Themodel shows that patience increases work and search effort (at least within a certain range of the discount rate), but that the relation with mobility is ambiguous.
Q9. What methods are used to estimate the relation between time preferences and search effort?
The authors estimate the relation between time preferences and search effort using different estimation methods: the equations using search attitude and a dummy indicating whether the worker applied for another job as the dependent variable are estimated by ordered probit and binary probit, respectively.