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Rush and Procrastination under Hyperbolic Discounting and Interdependent Activities

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  • Brocas, Isabelle
  • Carrillo, Juan D

Abstract

We analyze the decision of individuals with time-inconsistent preferences to invest in projects yielding either current costs and future benefits or current benefits and future costs. We show that competition between agents for the same project mitigates the tendency to procrastinate on the first type of activities (i.e. to undertake them "too late") and to rush on the second one (i.e. to undertake them "too early"). Competition can therefore increase the expected welfare of each individual. On the contrary, complementarity of projects exacerbates the tendency to rush and to procrastinate and therefore it can decrease the expected welfare of each individual. Copyright 2001 by Kluwer Academic Publishers

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  • Brocas, Isabelle & Carrillo, Juan D, 2001. "Rush and Procrastination under Hyperbolic Discounting and Interdependent Activities," Journal of Risk and Uncertainty, Springer, vol. 22(2), pages 141-164, March.
  • Handle: RePEc:kap:jrisku:v:22:y:2001:i:2:p:141-64
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    Cited by:

    1. Linardi, Sera & Tanaka, Tomomi, 2013. "Competition as a savings incentive: A field experiment at a homeless shelter," Journal of Economic Behavior & Organization, Elsevier, vol. 95(C), pages 240-251.
    2. Asheim, Geir B., 2007. "Procrastination, partial naivete, and behavioral welfare analysis," Memorandum 02/2007, Oslo University, Department of Economics.
    3. Brocas, Isabelle & Carrillo, Juan D., 2005. "A theory of haste," Journal of Economic Behavior & Organization, Elsevier, vol. 56(1), pages 1-23, January.
    4. Liam Delaney & Caroline Rawdon & Kevin Denny & Wen Zhang & Richard A.P. Roche, 2008. "Event-Related Potentials Reveal Differential Brain Regions Implicated in Discounting in Two Tasks," Working Papers 200811, Geary Institute, University College Dublin.
    5. repec:pit:wpaper:484 is not listed on IDEAS
    6. Jianjun Miao, 2008. "Option exercise with temptation," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), pages 473-501.
    7. Yang, Yang & Shoji, Isao & Kanehiro, Sumei, 2009. "Optimal dividend distribution policy from the perspective of the impatient and loss-averse investor," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 38(3), pages 534-540, June.
    8. 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.
    9. Battaglini, Marco & Benabou, Roland & Tirole, Jean, 2005. "Self-control in peer groups," Journal of Economic Theory, Elsevier, vol. 123(2), pages 105-134, August.
    10. Weinschenk, Philipp, 2012. "Increasing workload in a stochastic environment," Economics Letters, Elsevier, vol. 115(2), pages 286-288.
    11. Philipp Weinschenk, 2010. "Increasing Workload in a Stochastic Environment," Discussion Paper Series of the Max Planck Institute for Research on Collective Goods 2010_43, Max Planck Institute for Research on Collective Goods.
    12. Joshua S. Gans & Peter Landry, 2016. "Procrastination in Teams," NBER Working Papers 21891, National Bureau of Economic Research, Inc.
    13. Carrillo, Juan D., 2005. "To be consumed with moderation," European Economic Review, Elsevier, vol. 49(1), pages 99-111, January.

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