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Time discounting in the presence of time constraints

Author

Listed:
  • Makito Takeuchi

    (Faculty of Business Administration, Tohoku Gakuin University, Sendai, Japan)

  • Masafumi Tsubuku

    (Faculty of Economics, Daito Bunka University, Tokyo, Japan)

Abstract

This study explores the intertemporal choice between goods in the presence of time constraints. While previous research showed that time preferences in intertemporal decisions can be represented by a decreasing hyperbolic function, we investigate how time preferences respond to the presence of time constraints to consuming goods. The experiment is based on questionnaire data and focuses on two types of products, gift certificates and food. The results show that the time discount rate increases over time in the presence of a time constraint. In addition, for all of the goods treated in this experiment, we confirm that individual tends to be more patient towards larger rewards (magnitude effect), and future negative payoffs are discounted at a lower rate than future positive payoffs (sign effect).

Suggested Citation

  • Makito Takeuchi & Masafumi Tsubuku, 2018. "Time discounting in the presence of time constraints," Economics Bulletin, AccessEcon, vol. 38(2), pages 1180-1186.
    • Handle: RePEc:ebl:ecbull:eb-18-00207
    as

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    References listed on IDEAS

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    6. George Loewenstein & Drazen Prelec, 1992. "Anomalies in Intertemporal Choice: Evidence and an Interpretation," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 107(2), pages 573-597.
    7. Thaler, Richard, 1981. "Some empirical evidence on dynamic inconsistency," Economics Letters, Elsevier, vol. 8(3), pages 201-207.
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    Cited by:

    1. Cruz Rambaud, Salvador & Ortiz Fernández, Piedad & Parra Oller, Isabel María, 2023. "A systematic review of the main anomalies in intertemporal choice," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 104(C).

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    More about this item

    Keywords

    Time discounting; Intertemporal choice; Time constraints;
    All these keywords.

    JEL classification:

    • D1 - Microeconomics - - Household Behavior
    • D9 - Microeconomics - - Micro-Based Behavioral Economics

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