IDEAS home Printed from
MyIDEAS: Login to save this paper or follow this series

Uncertain lifetime and intertemporal choice : risk aversion as a rationale for time discounting

This paper makes explicit the links between preferences over lotteries on length of life and intertemporal choice. I show that the approach used by traditional life cycle models to account for uncertain survival corresponds to a strong assumption of risk neutrality with respect to the length of life. Relaxing such an assumption leads us to develop a more general formulation of lifetime utility in which time preferences are directly related to preferences over length of life. In particular, it provides an explanation for exponential and hyperbolic discounting which are found to result, in a first approximation, from constant and hyperbolic risk aversion with respect to the length of life.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL:
Download Restriction: no

Paper provided by Laboratoire d'Economie Appliquee, INRA in its series Research Unit Working Papers with number 0108.

in new window

Length: 35 pages
Date of creation: Dec 2001
Date of revision:
Handle: RePEc:lea:leawpi:0108
Contact details of provider: Postal: INRA-LEA, 48, Boulevard Jourdan, 75014 Paris, France
Phone: 331 43136364
Fax: 331 43136362
Web page:

No references listed on IDEAS
You can help add them by filling out this form.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:lea:leawpi:0108. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Madeleine Roux)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.