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Addiction and Present-Biased Preferences

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Author Info

  • Ted O'Donoghue

    (Cornell University)

  • Matthew Rabin

    (University of California, Berkeley)

Abstract

We investigate the role that self-control problems modeled as time-inconsistent, present-biased preferences and a person's awareness of those problems might play in leading people to develop and maintain harmful addictions. Present-biased preferences create a tendency to over-consume addictive products, and awareness of future self-control problems can mitigate or exacerbate this over-consumption, depending on the environment. Our central concern is the welfare consequences of this over-consumption. Our analysis suggests that for realistic environments self-control problems are a plausible source of severely harmful addictions only in conjunction with some unawareness of future self- control problems.

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File URL: http://128.118.178.162/eps/game/papers/0303/0303005.pdf
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Bibliographic Info

Paper provided by EconWPA in its series Game Theory and Information with number 0303005.

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Length: 53 pages
Date of creation: 21 Mar 2003
Date of revision:
Handle: RePEc:wpa:wuwpga:0303005

Note: 53 pages, Acrobat .pdf
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Web page: http://128.118.178.162

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  1. George Loewenstein, Ted O'Donoghue and Matthew Rabin., 2000. "Projection Bias in Predicting Future Utility," Economics Working Papers E00-284, University of California at Berkeley.
  2. Carrillo, Juan D & Mariotti, Thomas, 2000. "Strategic Ignorance as a Self-Disciplining Device," Review of Economic Studies, Wiley Blackwell, vol. 67(3), pages 529-44, July.
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  7. Ted O' Donoghue and Matthew Rabin., 2000. "Choice and Procrastination," Economics Working Papers E00-281, University of California at Berkeley.
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Citations

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Cited by:
  1. Henrekson, Magnus & Dreber, Anna, 2004. "Female Career Success: Institutions, Path Dependence and Psychology," Working Paper Series in Economics and Finance 574, Stockholm School of Economics, revised 27 Jan 2005.
  2. Berg, Nathan & Kim, Jeong-Yoo, 2010. "Demand for Self Control: A model of Consumer Response to Programs and Products that Moderate Consumption," MPRA Paper 26593, University Library of Munich, Germany.
  3. Grignon, Michel, 2009. "An empirical investigation of heterogeneity in time preferences and smoking behaviors," The Journal of Socio-Economics, Elsevier, vol. 38(5), pages 739-751, October.
  4. Ciccarelli, Carlo & Giamboni, Luigi & Waldmann, Robert, 2007. "Cigarette smoking, pregnancy, forward looking behavior and dynamic inconsistency," MPRA Paper 8878, University Library of Munich, Germany.
  5. Trenton Smith & Young H. Lee, 2006. "Why are Americans Addicted to Baseball? An Empirical Analysis of Fandom in Korea and the U.S," Working Papers 2006-05, School of Economic Sciences, Washington State University.
  6. Smith, Trenton G. & Tasnadi, Attila, 2007. "A theory of natural addiction," Games and Economic Behavior, Elsevier, vol. 59(2), pages 316-344, May.
  7. Gerking, S.D. & Khaddaria, R., 2012. "Perceptions of health risk and smoking decisions of young people (Online First)," Open Access publications from Tilburg University urn:nbn:nl:ui:12-5327214, Tilburg University.
  8. B. Douglas Bernheim & Antonio Rangel, 2003. "Addiction and Cue-Conditioned Cognitive Processes," NajEcon Working Paper Reviews 666156000000000052, www.najecon.org.
  9. Ted O’Donoghue & Matthew Rabin, 2001. "Risky Behavior among Youths: Some Issues from Behavioral Economics," NBER Chapters, in: Risky Behavior among Youths: An Economic Analysis, pages 29-68 National Bureau of Economic Research, Inc.
  10. Makarov, Uliana, 2011. "Networking or not working: A model of social procrastination from communication," Journal of Economic Behavior & Organization, Elsevier, vol. 80(3), pages 574-585.
  11. Bruno S. Frey & Christine Benesch & Alois Stutzer, . "Does watching TV make us happy?," IEW - Working Papers 241, Institute for Empirical Research in Economics - University of Zurich.
  12. Papoutsi, Georgia & Drichoutis, Andreas & Nayga, Rodolfo, 2011. "The causes of childhood obesity: A survey," MPRA Paper 30992, University Library of Munich, Germany.
  13. David Madden, 2002. "Setting the Appropriate Tax on Cigarettes in Ireland," Working Papers 200225, School Of Economics, University College Dublin.
  14. D.Dragone, 2005. "Incoerenza Dinamica ed Autocontrollo: Proposta per un'Analisi Interdisciplinare," Working Papers 549, Dipartimento Scienze Economiche, Universita' di Bologna.
  15. Teck H. Ho & Noah Lim & Colin Camerer, 2005. "Modeling the Psychology of Consumer and Firm Behavior with Behavioral Economics," Levine's Bibliography 784828000000000476, UCLA Department of Economics.

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