Delay Aversion Under a General Class of Preferences

Abstract

I study the characterization of delay aversion in a general class of intertemporal utility functions by adapting the behavioral definition introduced by Benoit and Ok (2007). I show that when the utility functions are partially differentiable, an agent is more delay averse if and only if he has higher marginal intertemporal rate of substitution between any two consecutive consumption periods. When preferences are represented by a recursive utility function, not necessarily differentiable, I provide a simple transformation rule to represent a more delay averse agent.

Keywords: Delay aversion, Time Preferences, Differentiable utility, recursive utility

JEL Classification: D90