Discount Functions and Self-Control Problems
10 Pages Posted: 8 Oct 2013 Last revised: 28 Mar 2014
There are 2 versions of this paper
Discount Functions and Self-Control Problems
Discount Functions and Self-Control Problems
Date Written: December 10, 2013
Abstract
In this paper we propose a new strategy for comparing the behavior of a hyperbolic discounter who possesses self-control problems to an exponential discounter who does not. Our strategy controls for inherent differences in overall levels of impatience across discount functions, which thereby allows us to isolate the pure effect of self-control problems. We argue that self-control problems, in their pure form as we identify them, can have a very surprising effect on intertemporal choices. Our method reveals that differences in decision making that could be attributed to self-control problems are at least partly (and perhaps entirely) just an artifact of an uncontrolled comparison.
Keywords: Discounting, Intertemporal Choice, Saving, Self-Control Problems
JEL Classification: D91, C61, D03
Suggested Citation: Suggested Citation
Do you have negative results from your research you’d like to share?
Recommended Papers
-
Estimating Discount Functions with Consumption Choices Over the Lifecycle
By David Laibson, Andrea Repetto, ...
-
Job Search and Hyperbolic Discounting: Structural Estimation and Policy Evaluation
-
Job Search and Hyperbolic Discounting: Structural Estimation and Policy Evaluation
-
By John Ameriks, Andrew Caplin, ...
-
Time Inconsistency and Welfare Program Participation: Evidence from the Nlsy
By Hanming Fang and Dan Silverman
-
Time-Inconsistency and Welfare Program Participation: Evidence from the Nlsy
By Hanming Fang and Dan Silverman