Procedures for eliciting time preferences

•We experimentally compare three methods for eliciting preferences over delayed payments.•Subjects’ choices are more patient in BDM than in an MPL with the same incentives.•This behavior violates Procedure Invariance.•We relate our findings to theoretical explanations of context-dependence.

We study three procedures to elicit attitudes toward delayed payments: the Becker–DeGroot–Marschak procedure; the second price auction; and the multiple price list. The payment mechanisms associated with these methods are widely considered as incentive compatible, thus if preferences satisfy Procedure Invariance, which is also widely (and often implicitly) assumed, they should yield identical time preference distributions. We find instead that the monetary discount rates elicited using the Becker–DeGroot–Marschak procedure are significantly lower than those elicited with a multiple price list. We show that the behavior we observe is consistent with an existing psychological explanation of preference reversals.