Good or Bad, We Want it Now: Fixed-Cost Present Bias for Gains and Losses Explains Magnitude Asymmetries in Intertemporal Choice

Hardisty, David J.; Appelt, Kirstin C.; Weber, Elke U.

doi:10.2139/ssrn.1979828

Cited by 68 publications

(74 citation statements)

References 56 publications

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“…An alternative hypothesis suggested by Hardisty et al (2013) is a variant of the "as soon as possible" hypothesis discussed in Study 3. Hardisty et al argued that people want to expedite both gains and losses.…”

Section: Studymentioning

confidence: 94%

The Value of Nothing: Asymmetric Attention to Opportunity Costs Drives Intertemporal Decision Making

2017

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T his paper proposes a novel account of impatience: People pay more attention to the opportunity costs of choosing larger, later rewards than to the opportunity costs of choosing smaller, sooner ones. Eight studies show that when the opportunity costs of choosing smaller, sooner rewards are subtly highlighted, people become more patient, whereas when the opportunity costs of choosing larger, later rewards are highlighted this has no effect. This pattern is robust to variations in the choice task, to the participant population, and to whether the choices are incentivized or hypothetical. We argue that people are naturally aware of the opportunity costs of delayed rewards but pay less attention to those associated with smaller, sooner ones. We conclude by discussing implications for theory and policy.Data, as supplemental material, are available at https://doi

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Section: Studymentioning

confidence: 94%

The Value of Nothing: Asymmetric Attention to Opportunity Costs Drives Intertemporal Decision Making

2017

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“…This theory underscores the importance of defaults. As another example, Hardisty, Appelt, and Weber (2013) study the combination of loss aversion and intertemporal decision making. In general, this work highlights the need to strive for a comprehensive understanding of decision making to explain the energy-efficiency gap.…”

Section: Do Loss Aversion or Reference Points Inhibit More Energy-effmentioning

confidence: 99%

Assessing the Energy-Efficiency Gap

Gerarden

Newell

Stavins

2017

Journal of Economic Literature

300

105

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“…Since the experimental setup concerns a specific real effort task which confronts subjects with choices over losses, it is legitimate to wonder whether our results would also apply when considering different tasks, or different domains of choice. Since some recent evidence based on hypothetical questions suggests that people discount losses and gains asymmetrically (see, e.g., Abdellaoui et al 2010, Hardisty et al 2013, Appelt et al 2011, would the relative importance of discounting and uncertainty be different if we had considered, say, scheduling a massage, rather than listening to noise? Although interesting, this is not the research question of this paper.…”

Section: Discussionmentioning

confidence: 99%

Choice reversal without temptation: A dynamic experiment on time preferences

Casari

Dragone

2015

J Risk Uncertain

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We study intertemporal choices through an experiment run over multiple dates and we show that intertemporal behavior is affected by additional drivers beyond impatience and present-biased preferences. By eliciting a subject's plan and tracking its implementation over time, this dynamic design helps our understanding of time inconsistency through the identification and measurement of three notions of choice reversal in intertemporal behavior. In the experiment, there is widespread choice reversal and demand for flexibility. Neither the usual exponential nor hyperbolic discounting models can account for the observed behavior.

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Good or Bad, We Want it Now: Fixed-Cost Present Bias for Gains and Losses Explains Magnitude Asymmetries in Intertemporal Choice

Cited by 68 publications

References 56 publications

The Value of Nothing: Asymmetric Attention to Opportunity Costs Drives Intertemporal Decision Making

The Value of Nothing: Asymmetric Attention to Opportunity Costs Drives Intertemporal Decision Making

Assessing the Energy-Efficiency Gap

Choice reversal without temptation: A dynamic experiment on time preferences

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