Purpose The relevance of present consumption bias on personal finance has been confirmed in several studies and has … contribute to our understanding of these issues by postulating a model of income uncertainty within a hyperbolic discounting … framework that measures the cost of financial intertemporal inconsistencies related to this bias. The emphasis is on the …

weighting functions for the risky prospects placed 6 and 12 months into the future. The experiment is used to test whether … decision errors can explain or be highly correlated with hyperbolic discounting and non-linear (inverse-S-shaped) probability … weighting. We find evidence that decision errors are strongly correlated with hyperbolic discounting but do not find that …