Last updated on January 3, 2016
I have discussed chronocentrism–“the egotism that one’s own generation is poised on the very cusp of history”–a few times on this blog (see here, here, and especially here). A few days before Christmas, I received an email from Star Tribune business reporter Patrick Kennedy, who had heard the term from an investment banker, and who wanted to chat about the concept. Here is what came out of a nice Christmas Eve chat:
We called Marc Bellemare, an associate professor of applied economics at the University of Minnesota who has applied chronocentrism to his work on the economics of global food policy, to further define the term made popular by British journalist Tom Standage, a science and technology writer for the Guardian newspaper and a deputy editor at the Economist.
Bellemare was happy to find parallels to the world of investing in explaining the concept. …
For investing, Bellemare pointed out that we look no further than the housing crash and the dot-com bubble.
He suggests chronocentrism leads to another economic concept called retrospective discounting, where our present bias leads us to put a lot of stock in the present and carefully pick and choose what we want to believe about the past.
The idea of retrospective (rather than the usual, prospective) present-biased preferences is how I see chronocentrism. That is, if we can give a greater weight to the present when looking forward, it is almost certainly the case that we also give a greater weight to the present when looking backward.