Differential effects of amount on temporal and probability discounting of gains and losses

Abstract

In four experiments, we compared the effects of delay, probability, and monetary amount on the subjective value of gains and losses. For delayed gains, smaller amounts were discounted more steeply than larger amounts, whereas the opposite pattern was observed with probabilistic gains. For both delayed and probabilistic losses, however, amount had much smaller and less reliable effects on discounting. Taken together, the pattern of differential magnitude effects leads to delayed gains' being discounted significantly more steeply than delayed losses, but only at smaller amounts, whereas probabilistic gains are discounted significantly more steeply than probabilistic losses, but only at larger amounts. Even though the same hyperbola-like function described both individual and group discounting of delayed and probabilistic gains and losses, the present findings suggest that different processes are involved in discounting positive and negative outcomes. Raw data may be downloaded from www.psychonomic.org/archive.

Delayed discounting of pain with and without monetary reward

“…Our study showed that delayed pain is discounted in a different way than that of the monetary losses that were discounted in previous research (Estle et al, 2006;Ostaszewski & Karzel, 2002;Weatherly & Derenne, 2013). If delayed punishments are higher or equal to immediate ones, as was the case in most of the previous studies on punishment discounting (Estle et al, 2006;Ostaszewski & Karzel, 2002;Weatherly & Derenne, 2013), delayed punishments are always the best choice from the perspective of the participant.…”

“…If delayed punishments are higher or equal to immediate ones, as was the case in most of the previous studies on punishment discounting (Estle et al, 2006;Ostaszewski & Karzel, 2002;Weatherly & Derenne, 2013), delayed punishments are always the best choice from the perspective of the participant. An interesting question emerges: why are there different preferences for delayed losses and delayed pain if both of them are considered punishment, even though there is no such variability for different reinforcements?…”

“…In summary, previous studies indicate that people tend to choose delayed punishments over immediate punishments (Estle et al, 2006;Ostaszewski & Bialaszek, 2010;Weatherly & Derenne, 2013), but this is not the case when choices of pain are studied (Hare, 1966;Story et al, 2013). In most of the previous studies, delayed punishment was of a higher or equal value to the immediate punishment, similar to studies of the discounting of reinforcements.…”

“…delayed losses are preferred over immediate losses (Estle, Green, Myerson, & Holt, 2006;Ostaszewski & Karzel, 2002;Weatherly & Derenne, 2013). However, most of the previous studies on punishment discounting have dealt only with monetary losses.…”

The arithmetic of discounting

“…Why was there then a (small) magnitude effect for losses in two experiments in the former (Estle et al, 2006) study? Possibly in the 50% of the cases when the receipts conditions preceded the payments condition, that primed the subjects to be more sensitive to magnitudes.…”