Do Languages Generate Future-Oriented Economic Behavior?

Languages vary in the ways in which they encode time. In some languages, like German, the same grammatical tense is used for the present and the future (weak FTR languages), while in other languages, like English, the marking of the present and the future are distinct (strong FTR languages). Studies based on survey data have shown that the usage of languages that grammatically associate the future and the present tends to be correlated with more future-oriented behavior. In this current study, we take an experimental approach to go beyond correlation and to identify the causal effect of language on future-oriented behavior which has not been identified yet. We let bilingual people who are fluent in two languages that vary in the way in which they encode time make a future-oriented economic decision: specifically, we ask participants in one of the two languages in which they are fluent to make a set of binary choices about whether they wish to be paid a certain amount of money earlier (today), or a larger amount of money later (in the following week). We then test whether the people who are randomly assigned to be asked in a strong FTR language require more future compensation than those asked in a weak FTR language. We find that being addressed in the strong-FTR language generates a higher time discount rate compared to being addressed in the weak-FTR language. In other words, participants who are addressed in languages in which the present and the future are marked more distinctly tend to value future events less than participants who are addressed in languages in which the present and the future are similarly marked.