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Lifetime Uncertainty and Time Preference

  • Nicolas Drouhin

    ()

Despite Fisher's (1930) psychological intuitions of and the formal treatment given by Yaari (1965, Review of Economic Studies 32, 137), the intertemporal model of choice is mainly a model with certain lifetime. The purpose of this paper is to reconsider this assumption, starting from a very simple two-period model of choice with lifetime uncertainty. We examine the comparative statics of the model at the first two orders and replace the concept of `pure time preference' by taking into account the subjective treatment of the probability of survival. Copyright Kluwer Academic Publishers 2001

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File URL: http://hdl.handle.net/10.1023/A:1015598809123
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Article provided by Springer in its journal Theory and Decision.

Volume (Year): 51 (2001)
Issue (Month): 2 (December)
Pages: 145-172

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Handle: RePEc:kap:theord:v:51:y:2001:i:2:p:145-172
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