Temptation: Immediacy and certainty
Fuente:
arXiv
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| Formato: | Preprint |
| Publicado: |
2024
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| _version_ | 1866909296733716480 |
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| author | Reddinger, J. Lucas |
| author_facet | Reddinger, J. Lucas |
| contents | Is an option especially tempting when it is both immediate and certain? I test the effect of risk on the present-bias factor given quasi-hyperbolic discounting. In my experiment workers allocate about thirty to fifty minutes of real-effort tasks between two weeks. I study dynamic consistency by comparing choices made two days in advance of the workday with choices made when work is imminent. My novel design permits estimation of present bias using a decision with a consequence that is both immediate and certain. I find greater present bias when the consequence is certain. This finding has implications for any economic decision involving a present-biased decision-maker, including labor contracting and consumer good pricing. I offer a methodological remedy for experimental economists. |
| format | Preprint |
| id |
arxiv_https___arxiv_org_abs_2407_14955 |
| institution | arXiv |
| publishDate | 2024 |
| record_format | arxiv |
| spellingShingle | Temptation: Immediacy and certainty Reddinger, J. Lucas General Economics Economics Is an option especially tempting when it is both immediate and certain? I test the effect of risk on the present-bias factor given quasi-hyperbolic discounting. In my experiment workers allocate about thirty to fifty minutes of real-effort tasks between two weeks. I study dynamic consistency by comparing choices made two days in advance of the workday with choices made when work is imminent. My novel design permits estimation of present bias using a decision with a consequence that is both immediate and certain. I find greater present bias when the consequence is certain. This finding has implications for any economic decision involving a present-biased decision-maker, including labor contracting and consumer good pricing. I offer a methodological remedy for experimental economists. |
| title | Temptation: Immediacy and certainty |
| topic | General Economics Economics |
| url | https://arxiv.org/abs/2407.14955 |