Pre-Commitment and Flexibility in a Time Decision Experiment

Marco Casari

Purdue University Economics Working Papers from Purdue University, Department of Economics

Abstract: This study presents experimental data on pre-commitment and flexibility where monetary rewards are delivered with an actual delay. Preference for pre-commitment is defined as willingness to pay a cost to restrict the size of the choice set available in the future. Preference for flexibility is defined as willingness to pay a cost to enlarge the choice set available in the future. The existing empirical evidence about these phenomena is rather limited. On the other hand, models of intertemporal choice differ widely on these issues, with some predicting only demand for pre-commitment, others only demand for flexibility, while others neither one. We find that two-thirds of the subjects cannot be accounted for with the canonical exponential discounting model and that there is demand for both pre-commitment and flexibility.

Keywords: experiments; time preferences; time inconsistency; preference for commitment; preference for flexibility; discounting (search for similar items in EconPapers)
JEL-codes: C91 D90 D81 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cba, nep-dcm, nep-exp and nep-upt
Date: Written

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Related works:
Journal Article: Pre-commitment and flexibility in a time decision experiment (2009)
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Persistent link: http://EconPapers.repec.org/RePEc:pur:prukra:1183

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