What is the characterization of asset prices and investor’s behavior under myopic or time-inconsistent preferences? This paper investigates the characterization of financial market equilibrium when individuals are myopic or time-inconsistent. We consider an infinite horizon economy under certainty with two heterogeneous CRRA individuals, one good and one long-lived asset. The question of surviv...

Regardless of its interpretation, the standard exponentially-discounted-utility model implies myopically forward-looking behavior: Preferences at a given period are completely determined by consumption in that period and preferences at the next period. This paper axiomatizes preferences that capture fully forward-looking behavior, delivering a new class of utility representations which includes...

Experimental tests of dynamically inconsistent time preferences have largely relied on choices over time-dated monetary rewards. Several recent studies have failed to find the standard patterns of present bias. However, such monetary studies contain oftendiscussed confounds. In this paper, we sidestep these confounds and investigate choices over consumption (real e↵ort) in a longitudinal experi...

Experimental choice data from 881 subjects based on 40 time-tradeoff items and 32 risky choice items reveal that most subjects are time-inconsistent and most violate the axioms of expected utility theory. These inconsistencies cannot be explained by well-known theories of behavioral inconsistency, such as hyperbolic discounting and cumulative prospect theory. Aggregating expected payoffs and th...

We provide a time-consistent model that addresses the preference reversals that motivate the time-inconsistency literature. The model subsumes the behavior generated by the time-inconsistency approach in finite settings but, unlike the time-inconsistent models, allows for self-control. This paper provides a brief summary of theoretical results shown elsewhere [Gul and Pesendorfer, Econometrica ...

Our perception of time is both nonlinear and nonstationary, which makes preference reversals possible. I decompose the sources of dynamic inconsistency into a time acceleration effect and a time compression effect. Standard economic models focus only on the second effect. I show that when the perception of time accelerates with age, the two effects can offset each other for hyperbolic discounte...

Intertemporal choice has drawn attention in behavioral economics, econophysics, and neuroeconomics. Recent studies in mainstream economics have mainly focused on inconsistency in intertemporal choice (dynamic inconsistency); while impulsivity/impatience in intertemporal choice has been extensively studied in behavioral economics of addiction. However, recent advances in neuroeconomic and econop...

Many logics for AI applications that are defined by denotational semantics are trivialized in the presence of inconsistency. It is therefore often desirable, and practically useful, to refine such logics in a way that inconsistency does not cause the derivation of any formula, and, at the same time, inferences with respect to consistent premises are not affected. In this paper, we introduce a g...

Age differences in three basic types of variability were examined: variability between persons (diversity), variability within persons across tasks (dispersion), and variability within persons across time (inconsistency). Measures of variability were based on latency performance from four measures of reaction time (RT) performed by a total of 99 younger adults (ages 17--36 years) and 763 older ...

Description Logic Knowledge and Action Bases (KABs) have been recently introduced as a mechanism that provides a semantically rich representation of the information on the domain of interest in terms of a DL KB and a set of actions to change such information over time, possibly introducing new objects. In this setting, decidability of verification of sophisticated temporal properties over KABs,...