A well-known common agreement in decision theory is that only exponential decision makers are time consistent i.e. with the mere passage of time, future choices must not contradict the initial choice. Building on this result, a large range of works has studied time inconsistency as a direct application of hyperbolic discounting. These articles share the common objective time assumption under wh...

The present study demonstrated the relative impact of gambling and nongambling contexts on the degree of delay discounting by pathological gamblers. We used a delay-discounting task with 20 pathological gamblers in and out of the natural context in which they regularly gambled. For 16 of the 20 participants, it appeared that the difference of context altered the subjective value of delayed rewa...

Standard analyses of economic policy assume exponential discounting, even though empirical and experimental evidence shows that preferences are time-inconsistent and discounting is hyperbolic. When policy makers– or the voters they must satisfy– apply smaller discount rates for long-term than for short-term decisions, they benefit from strategically investing in infrastructure and technologies ...

Humans and animals are more likely to take an action leading to an immediate reward than actions with delayed rewards of similar magnitudes. Although such devaluation of delayed rewards has been almost universally described by hyperbolic discount functions, the rate of this temporal discounting varies substantially among different animal species. This might be in part due to the differences in ...

Humans discount larger delayed rewards less steeply than smaller rewards, whereas no such magnitude effect has been observed in rats (and pigeons). It remains possible that rats' discounting is sensitive to differences in the quality of the delayed reinforcer even though it is not sensitive to amount. To evaluate this possibility, Experiment 1 examined discounting of qualitatively different foo...

We present an asymptotically valid analysis of a simple optimal growth model with hyperbolic discounting. We use the implicit function theorem for Banach spaces to show that for small deviations from exponential discounting there is a unique solution near the exponential discounting solution in the Banach space of consumption functions with bounded derivatives. The proof is constructive and pro...

In this paper intertemporal decision making is analysed from a framework that defines the differences in value for decision options at present and future time points in terms of the extra amount of mental burden or work load that is expected to occur when a future option is chosen. It is shown how existing hyperbolic and exponential discounting models for intertemporal decision making both fit ...

A well-known common agreement in decision theory is that only exponential decision makers are time consistent i.e. with the mere passage of time, future choices must not contradict the initial choice. Building on this result, a large range of works has studied time inconsistency as a direct application of hyperbolic discounting. These articles share the common objective time assumption under wh...

Due to factors such as temptation, choices may not respect normative preference (the agent’s own, subjective view of what constitutes his welfare). Nevertheless, the evidence on preference reversals suggests a means of recovering normative preference from choice. A de…nition of normative preference in terms of choices between su¢ ciently delayed alternatives is formulated and studied. Mild cond...

The tendency to discount the value of future rewards has become one of the best-studied constructs in the behavioral sciences. Although hyperbolic discounting remains the dominant quantitative characterization of this phenomenon, a variety of models have been proposed and consensus around the one that most accurately describes behavior has been elusive. To help bring some clarity to this issue,...