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The evolution of hyperbolic discounting: Implications for truly social valuation of the future

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  • Gowdy, John
  • Rosser, J. Barkley
  • Roy, Loraine

Abstract

We explore the standard expected utility model and alternatives to it. We then examine the behavioral and neurological evidence for hyperbolic discounting. We discuss evidence related to the neurological and behavioral evolution of discounting in non-human animals and in humans. We explore new findings about the importance of sociality in human behavior and the implications for truly social time preference. Finally, we discuss the implications of the neurological evidence on discounting for social environmental valuation, in particular the implications for very long-run decisions such as those involved in climate change mitigation and biodiversity preservation.

Suggested Citation

  • Gowdy, John & Rosser, J. Barkley & Roy, Loraine, 2013. "The evolution of hyperbolic discounting: Implications for truly social valuation of the future," Journal of Economic Behavior & Organization, Elsevier, vol. 90(S), pages 94-104.
  • Handle: RePEc:eee:jeborg:v:90:y:2013:i:s:p:s94-s104
    DOI: 10.1016/j.jebo.2012.12.013
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    References listed on IDEAS

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    Cited by:

    1. repec:spr:endesu:v:19:y:2017:i:3:d:10.1007_s10668-016-9771-1 is not listed on IDEAS
    2. Giuseppe Munda, 2015. "Beyond Gdp: An Overview Of Measurement Issues In Redefining ‘Wealth’," Journal of Economic Surveys, Wiley Blackwell, vol. 29(3), pages 403-422, July.
    3. Karbowski, Adam, 2016. "Discussion on the Social Rate of Discount: from Sen to Behavioural Economics," EconStor Open Access Articles, ZBW - German National Library of Economics, pages 46-60.
    4. repec:eee:forpol:v:83:y:2017:i:c:p:58-69 is not listed on IDEAS
    5. Marcus T. Wolfe & Pankaj C. Patel, 2017. "Instant gratification: temporal discounting and self-employment," Small Business Economics, Springer, vol. 48(4), pages 861-882, April.
    6. repec:gam:jsusta:v:9:y:2017:i:5:p:850-:d:99183 is not listed on IDEAS
    7. Gébert, Judit, 2015. "Mit is kell fenntartani?. Fenntarthatóság a képességszemlélet perspektívájából
      [Sustaining what?. Sustainability in terms of the capability approach]
      ," Közgazdasági Szemle (Economic Review - monthly of the Hungarian Academy of Sciences), Közgazdasági Szemle Alapítvány (Economic Review Foundation), vol. 0(9), pages 972-989.
    8. repec:eee:ecoser:v:18:y:2016:i:c:p:100-109 is not listed on IDEAS

    More about this item

    Keywords

    Behavioral evolution; Discounted utility; Hernnstein's matching law; Hyperbolic discounting; Neuroeconomics; Social time preference;

    JEL classification:

    • D03 - Microeconomics - - General - - - Behavioral Microeconomics: Underlying Principles
    • D60 - Microeconomics - - Welfare Economics - - - General
    • D87 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Neuroeconomics
    • D90 - Microeconomics - - Micro-Based Behavioral Economics - - - General
    • H43 - Public Economics - - Publicly Provided Goods - - - Project Evaluation; Social Discount Rate

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