Behavioral economics and the marshmallow experiment on delayed gratification.

What You Can Learn From the Marshmallow Test

by Elaine Schwartz    •    Oct 24, 2013    •    1243 Views

Forty years ago, psychologist Walter Mischel began studying delayed gratification by giving young children a choice. A child and a single marshmallow were left in a room. The child could have one marshmallow now or two when the adult returned minutes later. 500 children were tested. Mischel concluded that at 4 years old, certain children can resist temptation. Some could last 20 minutes while others capitulated immediately. The average resistance time was 7 or 8 minutes. (Researchers also used chocolate bars and Oreo cookies.)

Years later, in a follow-up study, Mischel discovered that the SAT scores of children who held out for 15 or 20 minutes were 210 points higher than those who lasted only 30 seconds. Returning to the same people 40 years later, he found that the high delayers had better jobs and coped better with frustration and stress.

Now, a new study from the University of Chicago and the Chinese University of Hong Kong adds to the list of economic benefits from delayed gratification.

The basic premise of the new paper is that delay adds value in certain situations. Why? Because waiting can make people feel an item is more valuable. Essentially, the researchers describe a feedback web. If waiting for something makes someone feel it is worth more, then that person is willing to display even more patience. As wait time grows, so too does the perception of value. The result? The very act of delaying gratification enables us to wait for a larger reward.

In one experiment from the Chicago/Hong Kong study, participants had 3 time scenarios and a “sooner-smaller” or a “larger-later” reward.

Data from: "When Waiting to Choose Increases Patience"

Data from: “When Waiting to Choose Increases Patience”

 

The implications of delayed gratification take us to retirement saving, long term investing and iPhone lines outside an Apple store. As a topic for public policy formation, many people’s inability to delay gratification could relate to government providing a default that forces us to wait if that is the better choice for the individual and for society.

The Mischel Marshmallow Experiment:

Sources and resources: Academic papers that discuss delayed gratification are here and here while a more popular perspective is in Daniel Kahneman’s Thinking Fast and Slow. In addition, Cass Sunstein’s and Richard Thaler’s Nudge provides a policy outlook.

Sections of this post appeared in a past econlife entry.

 

 

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