Discount functions and self-control problems

In this paper we propose a new strategy for comparing the behavior of a hyperbolic discounter who possesses self-control problems to an exponential discounter who does not. Our strategy controls for inherent differences in overall levels of impatience across discount functions, which thereby allows us to isolate the pure effect of self-control problems. We argue that self-control problems, in their pure form as we identify them, can have a very surprising effecton intertemporal choices. Our method reveals that differences in decision making that could be attributed to self-control problems are at least partly (and perhaps entirely) just an artifact of an uncontrolled comparison.

Netspar, Network for Studies on Pensions, Aging and Retirement, is a thinktank and knowledge network. Netspar is dedicated to promoting a wider understanding of the economic and social implications of pensions, aging and retirement in the Netherlands and Europe.


Mission en strategy           •           Network           •           Organisation           •          Magazine
Board Brief            •            Actionplan 2023-2027           •           Researchagenda


Our partners

B20160708_universiteit utrecht
B20210909_SPMS_logo download greyscale smaller
View all partners