An extension of quasi-hyperbolic discounting to continuous time

• 成果类型: Article
• 署名作者: Pan, Jinrui; Webb, Craig S.; Zank, Horst
• 署名单位: University of Manchester
• 刊物名称: GAMES AND ECONOMIC BEHAVIOR
• ISSN/ISSBN: 0899-8256
• DOI: 10.1016/j.geb.2014.11.003
• 发表日期: 2015
• 页码: 43-55
• 关键词: discounting; present bias; Decreasing impatience; bargaining

摘要

Two-Stage Exponential (TSE) discounting, the model developed here, generalises exponential discounting in a parsimonious way. It can be seen as an extension of Quasi-Hyperbolic discounting to continuous time. A TSE discounter has a constant rate of time preference before and after some threshold time; the switch point. If the switch point is expressed in calendar time, TSE discounting captures time consistent behaviour. If it is expressed in waiting time, TSE discounting captures time invariant behaviour. We provide preference foundations for all cases, showing how the switch point is derived endogenously from behaviour. We apply each case to Rubinstein's infinite-horizon, alternating-offers bargaining model. (C) 2014 Elsevier Inc. All rights reserved.