Projection bias in predicting future utility

• 成果类型: Article
• 署名作者: Loewenstein, G; O'Donoghue, T; Rabin, M
• 署名单位: Carnegie Mellon University; Cornell University; University of California System; University of California Berkeley
• 刊物名称: QUARTERLY JOURNAL OF ECONOMICS
• ISSN/ISSBN: 0033-5533
• DOI: 10.1162/003355303322552784
• 发表日期: 2003
• 页码: 1209-1248
• 关键词: habit formation; loss aversion; DURABILITY BIAS; decision-making; SOCIAL UTILITY; consumption; LIFE; preferences; savings; GROWTH

摘要

People exaggerate the degree to which their future tastes will resemble their current tastes. We present evidence from a variety of domains which demonstrates the prevalence of such projection bias, develop a formal model of it, and use this model to demonstrate its importance in economic environments. We show that, when people exhibit habit formation, projection bias leads people to consume too much early in life, and to decide, as time passes, to consume more-and save less-than originally planned. Projection bias can also lead to misguided purchases of durable goods. We discuss a number of additional applications and implications.