Time consistency has become an integral part of explanations of many economic phenomena, in large part because of insights it gives into these phenomena. For example, it helps us to formalize and hence better understand a welfare-maximizing government’s incentive to promise that accumulated capital will not be taxed and then to use a capital levy in the face of severe revenue shortfalls. The go...

This paper develops a theory of optimal provision of commitment devices to people who value both commitment and ‡exibility, and whose preferences di¤er in the degree of time inconsistency. If time inconsistency is observable, then both a planner and a monopolist provide devices that help each person commit to the e¢ cient level of ‡exibility. But the combination of unobservable time inconsisten...

We extend expected utility theory to situations in which agents experience feelings of anticipation at dates prior to the resolution of uncertainty. We show how these anticipatory feelings may result in time inconsistency. We provide examples to show the impact of anticipation on decision making.

This paper discusses senses in which alternative representations of the preferences that underlie robust control theory are or are not time consistent. The multiplier preferences of Hansen, Sargent, Turmuhambetova, and Williams (2006) are time consistent by construction. So too are their constraint preference, provided that continuation entropy is carried along as an additional state variable. ...