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Once Upon a Time Preference - How Rationality and Risk Aversion Change the Rationale for Discounting

Traeger, Christian P. - 2012

The paper develops an axiomatic framework for rational decision making. The von Neumann-Morgenstern axioms give rise to a richer risk attitude than that captured in the standard discounted expected utility model. I derive three models that permit a more comprehensive risk evaluation. These...

Persistent link: https://www.econbiz.de/10013107349

The Impact of Financial Education on Adolescents' Intertemporal Choices

Lührmann, Melanie - 2018

We study the impact of financial education on intertemporal choice in adolescence. The educational program was randomly assigned among high-school students and choices were measured using an incentivized experiment. Students who participated in the program make more time-consistent choices; are...

Persistent link: https://www.econbiz.de/10012937819

Foundations for Intertemporal Choice

al-Nowaihi, Ali - 2018

We consider discounted-utility models with a reference stream of outcomes. We provide a common framework for the main empirically supported discount functions in terms of three underlying functions: The delay, speedup and generating functions. Each of the delay and speedup functions can be...

Persistent link: https://www.econbiz.de/10012920859

Do Preferences and Biases Predict Life Outcomes? Evidence from Education and Labor Market Entry Decisions

Backes-Gellner, Uschi - 2018

Evidence suggests that acquiring human capital is related to better life outcomes, yet young peoples' decisions to invest in or stop acquiring human capital are still poorly understood. We investigate the role of time and reference-dependent preferences in such decisions. Using a data set that...

Persistent link: https://www.econbiz.de/10012924444

Matching and Saving in Continuous Time : Theory

Bayer, Christian - 2010

We analyse optimal saving of risk-averse households when labour income stochastically jumps between two states. The generalized Keynes-Ramsey rule includes a precautionary savings term. A phase diagram analysis illustrates consumption and wealth dynamics within and between states. There is an...

Persistent link: https://www.econbiz.de/10013144214

Adaptation, Anticipation-Bias and Optimal Income Taxation

Aronsson, Thomas - 2012

Adaptation is omnipresent but people systematically fail to correctly anticipate the degree to which they adapt. This leads individuals to make inefficient intertemporal decisions. This paper concerns optimal income taxation to correct for such anticipation-biases in a framework where consumers...

Persistent link: https://www.econbiz.de/10013104834

Effects of Unilateral Climate Policy on Terms of Trade, Capital Accumulation, and Welfare in a World Economy

Farmer, Karl - 2013

We present a two-good, two-country overlapping generations model where emissions arise from production and each country has a domestic emission permit system. When one country unilaterally reduces her cap on emissions, her output available for domestic and foreign consumption diminishes more...

Persistent link: https://www.econbiz.de/10012753478

What Drives Aggregate Investment? : Evidence from German Survey Data

Bachmann, Ruediger; Zorn, Peter - 2021

The ifo Investment Survey asks firms in the German manufacturing sector about the importance of sales, technological … factors, finance, return expectations, and macroeconomic policy for their investment activity in a given year. We show that … these subjective investment determinants 1) capture economically what their labels suggest, and 2) have strong explanatory …

Persistent link: https://www.econbiz.de/10013315790

The Impact of Financial Education on Adolescents' Intertemporal Choices

Lührmann, Melanie; Serra-Garcia, Marta; Winter, Joachim - CESifo - 2014

We study the impact of financial education on intertemporal choice in adolescence. The program was randomly assigned among high-school students and intertemporal choices were measured using an incentivized experiment. Students who participated in the program display a decrease in time...

Persistent link: https://www.econbiz.de/10011274344

Evidence on Individual Preferences for Longevity Risk

Delprat, Gaëtan; Leroux, Marie-Louise; Michaud, Pierre-Carl - CESifo - 2013

The standard model of intertemporal choice assumes risk neutrality toward the length of life: due to additivity, agents are not sensitive to a mean preserving spread in the length of life. Using a survey fielded in the RAND American Life Panel (ALP), this paper provides empirical evidence on...

Persistent link: https://www.econbiz.de/10010639424

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