The influence of social connectedness on hyperbolic discounting

  • Elio Keko Elio Keko

Countless studies have proved the existence of the phenomenon of hyperbolic discounting, which as a behavioral model, pertains to comparisons across decisions, when individuals are irrevocablyfaced with intertemporal choices. Due to a variety of motives that will be explored in length in this paper, there seems to exist a present bias in decision-making that reversals favoring presentrewards and discounting future ones. Despite the advancements made in this subject matter, research in this field suggests that borrowing insight from the discipline of psychology will greatly aid and shed further light into identifying and understanding the antecedents ofintertemporal decision-making. This paper aims to unravel the extent in which social connectedness influences hyperbolic discounting and the consequences of such influence. In addition to the responses gathered by means of an inquiry into the participants’ subjective judgment, the core indicator is that the perception of future social connectedness was influenced in a lab setting. The findings reveal a significant effect of social connectedness on hyperbolic discounting and provide evidence that this important socio-psychological construct can substantially aid in attaining an enhanced understanding of the intertemporal choice.A further purpose of this study is attempting to place the values of the derived parameters into a wider context through their application in the marketing world. Ultimately, due to the novelty of associations made in this paper, suggestions will be offered on potential research that will allow for future advancement in this field of study.

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.

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