Intertemporal choice with liquidity constraints: Theory and experiment
Economics Letters, 2013, vol. 118, issue 1, 101-103
Since Thaler (1981), we have lived with the uncomfortable stylized fact that many humans choose strictly dominated actions in intertemporal choice experiments. We designed an experiment to probe the reasons for the apparently suboptimal behavior, and we find that the classic Fisher (1930) intertemporal choice theory with perceived transaction costs and liquidity constraints is perfectly consistent with our experimental data, whereas hyperbolic discounting is not.
Keywords: Intertemporal choice; Liquidity; Present bias; Hyperbolic discounting (search for similar items in EconPapers)
JEL-codes: C9 D1 D9 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5) Track citations by RSS feed
Downloads: (external link)
Full text for ScienceDirect subscribers only
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:118:y:2013:i:1:p:101-103
Access Statistics for this article
Economics Letters is currently edited by Economics Letters Editorial Office
More articles in Economics Letters from Elsevier
Bibliographic data for series maintained by Dana Niculescu ().