THE EFFECT OF LANGUAGE ON ECONOMIC BEHAVIOR: EVIDENCE FROM SAVINGS RATES, HEALTH BEHAVIORS, AND RETIREMENT ASSETS By

Languages differ dramatically in how much they require their speakers to mark the timing of events when speaking. In this paper I test the hypothesis that being required to speak differently about future events (what linguists call strongly grammaticalized future-time reference) leads speakers to treat the future as more distant, and to take fewer future-oriented actions. Consistent with this hypothesis I find that in every major region of the world, speakers of strong-FTR languages save less per year, hold less retirement wealth, smoke more, are more likely to be obese, and suffer from worse long-run health. This holds true even after extensive controls that compare only demographically similar individuals born and living in the same country. While not dispositive, the evidence does not seem to support the most obvious forms of common causation. Implications of these findings for theories of intertemporal choice are discussed. ∗Comments are welcome at 135 Prospect St, New Haven CT, 06511, or at [email protected]. I am indebted to Judy Chevalier, Shane Frederick, Emily Oster, Sharon Oster, Ben Polak, and seminar participants at Yale and Berkeley for invaluable feedback. The most recent version of this working paper is available at http://faculty.som.yale.edu/keithchen/.