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Choice over Time

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Author Info
Paola Manzini () (Queen Mary, University of London)
Marco Mariotti () (Queen Mary, University of London)

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Abstract

In the last twenty years a growing body of experimental evidence has posed a challenge to the standard Exponential Discounting Model of choice over time. Attention has focused on some specific 'anomalies', notably preference reversal and declining discount rates, leading to the formulation of the model of hyperbolic discounting which is finding increasing favour in the literature. In this paper we provide a survey of both the theoretical modelling and the experimental evidence relating to choice over time. As we will show, a careful analysis of the mapping between theoretical models and experimental investigations raises questions as to whether some of the most focused upon anomalies should be indeed classified as such, or whether they are really the most challenging ones for conventional theory. New developments are emerging both at the theoretical and empirical level, opening up new exciting avenues for investigation.

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Paper provided by Queen Mary, University of London, Department of Economics in its series Working Papers with number 605.

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Date of creation: Sep 2007
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Handle: RePEc:qmw:qmwecw:wp605

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Keywords: Time preference Choice over time Theory Experiments

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Find related papers by JEL classification:
C91 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Individual Behavior
D9 - Microeconomics - - Intertemporal Choice and Growth

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
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    Other versions:
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    Other versions:
  37. Steffen Andersen & Glenn W. Harrison & Morten I. Lau & E. Elisabet Rutström, 2008. "Eliciting Risk and Time Preferences," Econometrica, Econometric Society, vol. 76(3), pages 583-618, 05. [Downloadable!] (restricted)
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    Other versions:
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Stefania Albanesi & Claudia Olivetti, 2007. "Gender Roles and Technological Progress," Boston University - Department of Economics - Working Papers Series WP2007-029, Boston University - Department of Economics. [Downloadable!]
    Other versions:
  2. Jawwad Noor, 2007. "Hyperbolic Discounting and the Standard," Levine's Bibliography 321307000000000939, UCLA Department of Economics. [Downloadable!]
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