We re-evaluate the theory, experimental design and econometrics behind claims that individuals exhibit non-constant discounting behavior. Theory points to the importance of controlling for the non-linearity of the utility function of individuals, since the discount rate is defined over...

We evaluate the claim that individuals exhibit a magnitude effect in their discounting behavior, which is said to occur when higher discount rates are inferred from choices made with lower principals, all else being equal. If the effect is robust, as claimed, we should be able to see it using...

Convenient assumptions about qualitative properties of the intertemporal utility function have generated counter-intuitive implications for the relationship between atemporal risk aversion and the intertemporal elasticity of substitution. If the intertemporal utility function is additively...

Measures of risk attitudes derived from experiments are often questioned because they are based on small stakes bets and do not account for the extent to which the decision-maker integrates the prizes of the experimental tasks with personal wealth. We exploit the existence of detailed...

We make the case that psychologists should make wider use of structural econometric methods. These methods involve the development of maximum likelihood estimates of models, where the likelihood function is tailored to the structural model. In recent years these models have been developed for a...

Ideas about what is "fair" influence preferences for redistribution. We study the dynamic evolution of different economies in which redistributive policies, perception of fairness, inequality and growth are jointly determined. We show how including beliefs about fairness can keep two otherwise...

We analyze the distributional e¤ects of adjustment cost in an environment with incomplete capital market. We find that a higher adjustment cost for human capital acquisition slows down the intergenerational mobility and results in a persistent inequality across generations. A low depreciation...

The debate on volunteering has paid insufficient attention to the relationship between public spending and volunteering. Recently, the importance of this relationship was highlighted by the current British government's "Big Society" plan, which asserts that withdrawing public agencies and...

The fixed effects (FE) estimator of "conditional convergence" in income based dynamic panel models could be biased downward when capital adjustment cost is present. Such a capital adjustment cost means a rising marginal cost of investment which could slow down the convergence. The standard FE...

The current British Government's "Big Society" plan is based on the idea that granting more freedom to local communities and volunteers will compensate for a withdrawal of public agencies and spending. This idea is grounded on a widely held belief about the relationship between government and...