rogat+-+sustp+-+matrix+annotation+2

Michelle Rogat Sustainability Problems Matrix - Annotation #2

"The effect of language on economic behavior: Evidence from savings rates, health behaviors, and retirement assets." by KM Chen

Chen, KM. (2013). The effect of language on economic behavior: Evidence from savings rates, health behaviors, and retirement assets. The American Economic Review. Retrieved from http://www.ingentaconnect.com/content/aea/aer/2013/00000103/00000002/art00005
 * 1. Full citation. **

From looking at the information he supplied at this IDEAS website, his research seems to be focused on cognitive and behavioral science in relation to economics. He has several co-authored papers listed and is affiliated with Yale's Management and Economics Schools. I came across his work by listening to his talk on TEDGlobal 2012.
 * 2. Where does the author work, what else has s/he written about, and what are her/his credentials? **

What I specifically like about Chen is that he added this to the opening page of his paper, " All errors are my own. I have no relevant or finanancial interests related to this project to disclose. The most recent version of this working paper is available at http://faculty.som.yale.edu/keithchen/." I like this because he is being transparent and even offers his email earlier in the text so that you can provide feedback.

In his TED talk he closes with saying that the goal of his work is to think about what influences us to think and decide one way or another.
 * 3. What is the main topic or argument of the text? **

Chen's paper on the same subject matter, argues that "languages that grammatically associate the future and the present, foster future-oriented behavior. This prediction arises naturally when well-documented effects of language structure are merged with models of intertemporal choice. Empirically, I find that speakers of such languages: save more, retire with more wealth, smoke less, practice safer sex, and are less obese."

Chen first researched into how language grammatically associates and depicts time in different cultures and did a literature review on the future time reference (FTR), including its broad categories, weak and strong FTR. He then examined how this linguistic difference is correlated with future oriented behaviors such as savings and long term health. He then tried to figure out if the languages were what affected the behavior or if it was just a coincidence in the overall culture. He then did some research into the savings rates of the OECD countries and did a regression to relate it to the linguistic differences. Chen then did a literature review on the effect language has on thought and later discusses the economics implications of this.
 * 4. Describe at least three ways that the main topic or argument is fleshed out. **


 * 5. What three quotes capture the critical import of the text? **
 * " The second way that language may affect future choices is by leading speakers to have more or less precise beliefs about the timing of future rewards. Languages with more grammatical time marking would lead speakers to hold more precise beliefs about the timing of events if either: marking time requires increased attention to time, or if these markers are encoded in memory."
 * " This would have the same effect on savings as mechanism one: people who speak weak-FTR languages (who speak the future and present identically) would save, exercise, and plan more, and spend, smoke, and over-consume less."
 * "One important issue in interpreting these results is the possibility that language is not causing but rather reflecting deeper differences that drive savings behavior. These available data provide preliminary evidence that much of the measured effects I find are causal, for several reasons that I have outlined in the paper. Mainly, self-reported measures of savings as a cultural value appear to drive savings behavior, yet are completely uncorrelated with the effect of language on savings. That is to say, while both language and cultural values appear to drive savings behavior, these measured effects do not appear to interact with each other in a way you would expect if they were both markers of some common causal factor."

The argument of this paper is that our language affects our behaviors and decision making process by making us think about an value time differently. This ties into sustainability because of the information delay in global warming, many people don't see it as a problem, and if it is they believe that future generations will be able to handle it. This thinking I would argue is mainly among the strongly FTR languaged cultures, and that those cultures put a lot of their faith into technology and future innovation being able to solve the problems we create today. The weak FTR language cultures lean more towards the precautionary principles and include future generations in the present community of stakeholders when making decisions. It is the way in which we view the proceedings of events and time in general that can have an enormous affect on our decision making and risk taking behaviors. The current timescales in America, a society with a strong FTR language, do not promote sustainability.
 * 6. Explain how the argument and evidence in the text supports your research focus. **

> about the timing of future pay offs makes saving more attractive."
 * 7. List at least two details or references from the text that you have used in your presentation and wiki post. **
 * "Overall, my findings are largely consistent with the hypothesis that languages with obligatory future-time reference lead their speakers to engage in less future-oriented behavior. On savings, the evidence is consistent on multiple levels: at an individual’s propensity to save, to long-run effects on retirement wealth, and in national savings rates. These findings extend to health behaviors ranging from smoking to condom use, as well as to measures of long-run health."
 * "In other words, if more finely partitioning events in time leads to more precise beliefs, weak-FTR speakers will be more willing to save than their strong-FTR counterparts. Intuitively, since discounting implies that the value of future rewards is a strictly-convex function of time, uncertainty