scholarly journals Hyperbolic Discount Functions, Undersaving, and Savings Policy

10.3386/w5635 ◽  
1996 ◽  
Author(s):  
David Laibson
Keyword(s):  
Hyperbolic Discount

Subjective Time Preference and Willingness to Pay for an Energy-Saving Durable Good

2001 ◽  
Vol 32 (3) ◽  
pp. 133-141 ◽  
Author(s):  
Gerrit Antonides ◽  
Sophia R. Wunderink
Keyword(s):  
Willingness To Pay ◽  
Energy Saving ◽  
Subjective Time ◽  
Durable Good ◽  
Discount Function ◽  
Hyperbolic Discount ◽  
The One ◽  
Two Parameter ◽  
Difference Effect ◽  
Better Than

Summary: Different shapes of individual subjective discount functions were compared using real measures of willingness to accept future monetary outcomes in an experiment. The two-parameter hyperbolic discount function described the data better than three alternative one-parameter discount functions. However, the hyperbolic discount functions did not explain the common difference effect better than the classical discount function. Discount functions were also estimated from survey data of Dutch households who reported their willingness to postpone positive and negative amounts. Future positive amounts were discounted more than future negative amounts and smaller amounts were discounted more than larger amounts. Furthermore, younger people discounted more than older people. Finally, discount functions were used in explaining consumers' willingness to pay for an energy-saving durable good. In this case, the two-parameter discount model could not be estimated and the one-parameter models did not differ significantly in explaining the data.

Maximin: a direct approach to sustainability

2006 ◽  
Vol 11 (3) ◽  
pp. 275-300 ◽  
Author(s):  
ROBERT D. CAIRNS ◽  
NGO VAN LONG
Keyword(s):  
Precautionary Principle ◽  
Direct Approach ◽  
Necessary Condition ◽  
Hyperbolic Discount ◽  
Discount Factors ◽  
Discounted Utility ◽  
Special Cases ◽  
Analytic Expression ◽  
Hotelling's Rule ◽  
Competitive Economy

We solve directly a general maximin (sustainment, intergenerational-equity) problem. Because the shadow values of a maximin problem do not correspond to the shadow values from a general discounted-utility solution, they correspond to the prices of only a very special competitive economy. Virtual discount factors for the economy arise. They do not correspond to hyperbolic discount factors. Hartwick's rule is derived and generalized naturally to take into account non-autonomous and non-deterministic features of the economy. Under uncertainty, Hartwick's rule is the analytic expression of a form of precautionary principle. Hotelling's rule is a necessary condition, but may be more complex than has been appreciated in simple models. Some interpretations of strong sustainment are special cases of weak sustainment but, paradoxically, may be more difficult to solve.

scholarly journals The implication of the hyperbolic discount model for the annuitisation decisions

2019 ◽  
Vol 19 (3) ◽  
pp. 372-391 ◽  
Author(s):  
Anran Chen ◽  
Steven Haberman ◽  
Stephen Thomas
Keyword(s):  
Fair Price ◽  
Hyperbolic Discount ◽  
Commitment Device

AbstractThe low demand for immediate annuities at retirement has been a long-standing puzzle. We show that a hyperbolic discount model can explain this behaviour and results in the attractiveness of long-term deferred annuities. With a set of benchmark assumptions, we find that retirees would be willing to pay a much higher price than the actuarial fair price for annuities with longer deferred periods. Moreover, if governments were to introduce a pre-commitment device which requires pensioners to make annuitisation decisions around 10 years before retirement, the take up rate of annuities could become higher.

Three other motivational factors

2005 ◽  
Vol 28 (5) ◽  
pp. 651-652
Author(s):  
Kent Bach
Keyword(s):  
Motivational Factors ◽  
Hyperbolic Discount

Ainslie uses his hyperbolic discount model to explain a dazzling array of puzzling motivational phenomena. In so doing, he assumes that the motivational force of a given option at a given time is directly proportional to its discount-adjusted reward as assessed at that time. He overlooks three other factors which, independently of the perceived reward, can affect motivational force.

Sex hormonal modulation of hyperbolic discount factor in men.

2008 ◽  
Vol 1 (1) ◽  
pp. 7-16 ◽  
Author(s):  
Taiki Takahashi ◽  
Kikue Sakaguchi ◽  
Mariko Oki ◽  
Toshikazu Hasegawa
Keyword(s):  
Discount Factor ◽  
Hyperbolic Discount ◽  
Hormonal Modulation
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