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Time preference and savoring – how to exploit the Loewenstein contradiction

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  • Mann, Konstantin A.

Abstract

The goal of this paper is to demonstrate and analyze the contradiction between the model of time preference and the concept of savoring and thereupon outline product categories that particularly apply to each one of the preceding models. Both concepts are discussed and exemplified in order to depict the contradiction. Subsequently, the terms utilitarian and hedonic goods are introduced in order to outline useful patterns for the correct assignment of goods to each model. The definition of utilitarian goods is applied to Maslow’s hierarchy of needs to show that they do particularly react to the model of time preference. Afterwards, existing knowledge about the concept of savoring is used in order to show the correlation between hedonic goods and the concept of savoring. Finally, the paper shows that companies can benefit from this categorization by either reacting to given distribution structures in terms of marketing or by identifying to which extent a certain product is perceived as utilitarian or hedonic good and correspondingly postpone or speed-up delivery.

Suggested Citation

  • Mann, Konstantin A., 2018. "Time preference and savoring – how to exploit the Loewenstein contradiction," MPRA Paper 84500, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:84500
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    File URL: https://mpra.ub.uni-muenchen.de/84500/1/MPRA_paper_84500.pdf
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    References listed on IDEAS

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    5. Loewenstein, George, 1987. "Anticipation and the Valuation of Delayed Consumption," Economic Journal, Royal Economic Society, vol. 97(387), pages 666-684, September.
    6. Shane Frederick & George Loewenstein & Ted O'Donoghue, 2002. "Time Discounting and Time Preference: A Critical Review," Journal of Economic Literature, American Economic Association, vol. 40(2), pages 351-401, June.
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    More about this item

    Keywords

    Time preference; Savoring; Discounting; Anticipatory utility;
    All these keywords.

    JEL classification:

    • B26 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Financial Economics

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