This paper deals with one of the main empirical problems associated with the rational addiction theory, namely that its … addiction equation cannot distinguish between time consistency and inconsistency in preferences. We show that an encompassing … general specification of the rational addiction model embeds the possibility of testing for time consistent versus time …

Since the end of the eighties the Becker and Murphy model of rational addiction has been the dominant approach to … estimate addiction effects. A rational addictive consumer, a smoker for instance, is supposed to maximize over the life cycle a … stable utility function and to be fully aware of the future consequences of her addiction and chooses to be an addicted …