People exaggerate the degree to which their future tastes will resemble their current tastes. We present evidence from a variety of domains which demonstrates the prevalence of such projection bias, develop a formal model of it, and use this model to demonstrate its importance in economic...

We examine how principals should design incentives to induce time-inconsistent procrastinating agents to complete tasks efficiently. Delay is costly to the principal, but the agent faces stochastic costs of completing the task, and efficiency requires waiting when costs are high. If the...

Recent models of procrastination due to self-control problems assume that a procrastinator considers just one option and is unaware of her self-control problems. We develop a model where a person chooses from a menu of options and is partially aware of her self-control problems. This menu model...

Departures from self-interest in economic experiments have recently inspired models of "social preferences." We design a range of simple experimental games that test these theories more directly than existing experiments. Our experiments show that subjects are more concerned with increasing...

People exaggerate the degree to which small samples resemble the population from which they are drawn. To model this belief in the "Law of Small Numbers," I assume that a person exaggerates the likelihood that a short sequence of i.i.d. signals resembles the long-run rate at which those signals...

We develop a model of reference-dependent preferences and loss aversion where "gain-loss utility" is derived from standard "consumption utility" and the reference point is determined endogenously by the economic environment. We assume that a person's reference point is her rational expectations...

In six experiments we show that initial valuations of familiar products and simple hedonic experiences are strongly influenced by arbitrary "anchors" (sometimes derived from a person's social security number). Because subsequent valuations are also coherent with respect to salient differences in...

Research on decision-making under uncertainty has been strongly influenced.by the documentation of numerous expected utility anomalies--behaviors that violate the expected utility axioms. The relative lack of progress on the closely related topic of intertemporal choice is partly due to the...