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The effect of quasi-hyperbolic discounting on rural land conversion timing


  • Matthew Jude Salois


This article explores how the presence of a quasi-hyperbolic discount parameter in a land investment model can affect conversion times for undeveloped rural land. A simple model of land development is compared using both exponential discounting and quasi-hyperbolic discounting. The presence of quasi-hyperbolic discounting tends to increase the rate of land conversion and may lead to possible overdevelopment of rural lands.

Suggested Citation

  • Matthew Jude Salois, 2012. "The effect of quasi-hyperbolic discounting on rural land conversion timing," Applied Economics Letters, Taylor & Francis Journals, vol. 19(9), pages 887-890, June.
  • Handle: RePEc:taf:apeclt:v:19:y:2012:i:9:p:887-890 DOI: 10.1080/13504851.2011.607119

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    References listed on IDEAS

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    Cited by:

    1. Di Corato, Luca, 2016. "Rural land development under hyperbolic discounting: a real option approach," Working Paper Series 2016:8, Swedish University of Agricultural Sciences, Department Economics.

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