Non-parametric test of time consistency: Present bias and future bias
AbstractThis paper reports the elicited time preference of human subjects in a laboratory setting. The model allows for non-linear utility functions, non-separability between delay and reward, and time inconsistency including future bias in addition to present bias. In particular, the experiment (1) runs a non-parametric test of time consistency and (2) estimates the form of time discount function independently of instantaneous utility functions, and then (3) the result suggests that many subjects exhibiting future bias, indicating an inverse S-curve time discount function.
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Bibliographic InfoArticle provided by Elsevier in its journal Games and Economic Behavior.
Volume (Year): 71 (2011)
Issue (Month): 2 (March)
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Web page: http://www.elsevier.com/locate/inca/622836
Intertemporal choice Time preference Present bias Future bias Reverse time inconsistency Increasing impatience Decreasing impatience;
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