Longitudinal Time Inconsistency

The hyperbolic discounting model predicts that preferences will often switch from a larger-later outcome (LL) to a smaller-sooner one (SS) as the two options move closer in time. However, remarkably few studies have been designed to test this prediction. In three studies using a theoretically appropriate longitudinal design, we examined the relative prevalence of different preference reversals. Across three experiments, we vary the time until SS (Amazon gift certificates) and find that the preponderance of preference reversals are consistent with the hyperbolic model only when the sooner outcome is immediate (less than one hour away), supporting a quasi-hyperbolic functional form.



Citation:

Daniel Read and Shane Frederick (2007) ,"Longitudinal Time Inconsistency", in NA - Advances in Consumer Research Volume 34, eds. Gavan Fitzsimons and Vicki Morwitz, Duluth, MN : Association for Consumer Research, Pages: 654-660.

Authors

Daniel Read, University of Durham, UK
Shane Frederick, Massachusetts Institute of Technology, USA



Volume

NA - Advances in Consumer Research Volume 34 | 2007



Share Proceeding

Featured papers

See More

Featured

Do You Trust the System? Interaction Effect between Perceived Economic Mobility and Socioeconomic Status on Fair Market Ideology and Consumer Responses

Chun-Ming Yang, Ming Chuan University, Taiwan
Chia-Chi Chang, National Chiao Tung University

Read More

Featured

Increasing Tax Salience Alters Investment Behavior

Abigail Sussman, University of Chicago, USA
Daniel Egan, Betterment
Sam Swift, Bowery Farming

Read More

Featured

Data-Driven Computational Brand Perception

Sudeep Bhatia, University of Pennsylvania, USA
Christopher Olivola, Carnegie Mellon University, USA

Read More

Engage with Us

Becoming an Association for Consumer Research member is simple. Membership in ACR is relatively inexpensive, but brings significant benefits to its members.