THE THEORY OF INTEREST

that is, the more impatient for present income. The lackof such traditions among the NegroeB tends toward ahigh rate of impatience, while the traditions of thriftamong the Scotch curb impatience.

Our thrift campaigns are designed to reduce impatienceby cultivating certain habits of regular saving out of in-come. So also is the propaganda for life insurance withits high-pressure salesmanship. On the other hand, thecorresponding salesmanship for installment buying tends,in the first instance, in the opposite direction. The in-dividual can indulge himself in the immediate enjoy-ment of a radio or an auto. Yet, it must not be overlookedthat, after the sale is made, there ensues a new responsi-bility to provide for the future payments agreed uponwhich may permanently improve the faculties of fore-sight and self-control.

(4) The fourth personal circumstance which may in-fluence impatience for immediate real income has to dowith the uncertainty of life of the recipient. We havealready seen, in a somewhat different connection, thatthe time preference of an individual will be affected bythe prospect of a long or short life, both because thetermination of life brings the termination of the incomefrom labor, and because it also terminates the person’senjoyment of all income.

It is the latter fact in which we are interested here—themanner in which the expectation of life of a personaffects the dependence of impatience on his income.There will be differences among different classes, dif-ferent individuals, and different ages of the same indi-vidual. The chance of death may be said to be the mostimportant rational factor tending to increase impatience;anything that would tend to prolong human life would

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