In page navigation

Time discounting

Updated: Aug 20, 2021

Placing a lower value on receipts or payments due in the future than on equal payments occurring immediately. This may be on account of pure time preference, uncertainty as to whether one will survive to benefit from receipts or make payments, or an expectation that higher incomes will make the marginal utility of money lower in the future than it is at present. See also discounting the future; social time preference.

Reference: Oxford Press Dictonary of Economics, 5th edt.

Sources & references
Risk disclaimer

Invezz is a place where people can find reliable, unbiased information about finance, trading, and investing – but we do not offer financial advice and users should always carry out their own research. The assets covered on this website, including stocks, cryptocurrencies, and commodities can be highly volatile and new investors often lose money. Success in the financial markets is not guaranteed, and users should never invest more than they can afford to lose. You should consider your own personal circumstances and take the time to explore all your options before making any investment. Read our risk disclaimer >

James Knight
Editor of Education
James is a lead content editor for Invezz. He's an avid trader and golfer, who spends an inordinate amount of time watching Leicester City and the… read more.