Is it 'Economics and Psychology'?: The Case of Hyperbolic Discounting
AbstractThe paper questions the methodology of "economics and psychology". It focuses on the case of hyperbolic discounting. Using some experimental results, I argue that the same sort of evidence which rejects the standard constant discount utility functions can just as easily reject hyperbolic discounting as well. Futhermore, a decision-making procedure based on similarity relation better explains the observations and is more intuitive. The paper concludes that combining "economics and psychology" requires opening the black box of decision-makers rather than modifying funcional forms.
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Date of creation: 04 Aug 2010
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- Ariel Rubinstein, 2000. "Is It 'Economics and Psychology?' : The Case of Hyperbolic Discounting," Levine's Working Paper Archive 7640, David K. Levine.
- Rubinstein, A., 2000. "Is it "Economics and Psychology"?: the Case of Hyperbolic Discounting," Papers 2000-21, Tel Aviv.
- Rubinstein, A., 2000. "Is it "Economics and Psychology"?: the Case of Hyperbolic Discounting," Papers 00-21, Tel Aviv.
- C90 - Mathematical and Quantitative Methods - - Design of Experiments - - - General
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