An a-MaxMin Utility Representation for Close and Distant Future Preferences with Temporal Biases

Jean-Pierre Drugeon () and Thai Ha-Hui ()
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Jean-Pierre Drugeon: Paris School of Economics and Centre National de la Recherche Scientifique
Thai Ha-Hui: Université Paris-Saclay, Univ Evry, EPEE

No 23-08, Documents de recherche from Centre d'Études des Politiques Économiques (EPEE), Université d'Evry Val d'Essonne

Abstract: This paper provides a framework for understanding preferences over utility streams across different time periods. We analyze preferences for the close future, for the distant future, and a synthesis of both, establishing a representation involving weights over time periods. Examining scenarios where two utility streams cannot be robustly compared to each other, we introduce notions in which one has more "potential" to be preferred over another, which lead to MaxMin, MaxMax, and a-MaxMin representations. Finally, we consider temporal bias in the form of violations of stationarity. For close future preferences, we obtain a generalization of quasi-hyperbolic discounting. For distant future preferences, we obtain Banach limits and discuss the relationship with exponential discounting.

Keywords: Axiomatisation; Myopia; Multiple Discounts; a-MaxMin Citeria; Temporal Biases; Banach Limits; Infinite Dimensional Topologies (search for similar items in EconPapers)
JEL-codes: D11 D15 D90 (search for similar items in EconPapers)
Pages: 41 pages
Date: 2023
New Economics Papers: this item is included in nep-mic and nep-upt
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