TIME PREFERENCE (IMPATIENCE)

ment of the income in that period, and hence increases theestimation in which a unit of certain income in thatparticular period is held. If that period is a remote one,the risk to which it is subject makes for a high regard forremote income; if it is the present (immediate future),the risk makes for a high regard for immediate income; ifthe risk applies to all periods of time alike, it acts as avirtual decrease of income all along the line.

There are, however, exceptional individuals of thegambler type in whom caution is absent or perverted.Upon these, risk will have quite the opposite effects.Some persons who like to take great speculative chancesare likely to treat the future as though it were especiallywell endowed, and are willing to sacrifice a large amountof their exaggerated expectations for the sake of a rela-tively small addition to their present income. In otherwords, they will have a high degree of impatience. Thesame individuals, if receiving an income which is riskyfor all periods of time alike, might, contrary to the rule,have, as a result, a low instead of a high degree of im-patience.

The income to which risk applies may be, of course,either the income from articles of capital external to manor the income from man himself, considered as an incomeproducer. In the latter case, often called earned income,the risk of losing the income is the risk of death or in-validism. This risk—the uncertainty as to human life,health and income producing power—is somewhat differ-ent from the uncertainty of income flowing from objectivecapital: for the cessation of life not only causes a ces-sation of the income produced by the dying human ma-chine, but also a cessation of the enjoyment of all in-come whatsoever—or rather a transfer of the enjoyment

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