The authors present a theory of rational behavior in which individuals maximize a set of stable preferences over goods with unknown addictive power. The theory is based on three fundamental postulates: consumption of the addictive good is not equally harmful to all, individuals possess...

The authors present a theory of additive behavior that can account for addicts' apparent disregard for the future consequences of their current actions. The discounting of future utility is increasing in past consumption, indicating increasingly myopic behavior as consumption increases. The...