What Is the Concept of “Time Preference” for Transaction Confirmation?

Time preference, in this context, refers to how quickly a user needs their transaction confirmed on the blockchain. A user with a high time preference is willing to pay a higher transaction fee (a higher "gas price") to incentivize a miner to include their transaction in the next block.

A user with a low time preference is willing to wait longer for confirmation and can therefore pay a lower fee. It is a direct reflection of the urgency of the transfer.