Self-control problems and the folk theorem

Axel Bernergård

Journal of Economic Behavior & Organization, 2019, vol. 163, issue C, 332-347

Abstract: This paper generalizes the basic complete information pure-action folk theorem such that it applies when discounting is present-biased and the discount factor between two successive periods increases with the waiting time until the periods are reached. We distinguish between time-consistent decision makers who maximize their initial preferences and time-inconsistent decision makers who maximize their current preferences, and our folk theorem holds for both types. Since discount functions are not assumed to have any specific functional form, decision makers are said to be patient if the sum of the discount factors for all periods is large.

Keywords: Folk theorem; Present-biased; Discounting; Hyperbolic (search for similar items in EconPapers)
JEL-codes: C73 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S016726811930143X
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:jeborg:v:163:y:2019:i:c:p:332-347

DOI: 10.1016/j.jebo.2019.05.004

Access Statistics for this article

Journal of Economic Behavior & Organization is currently edited by Houser, D. and Puzzello, D.

More articles in Journal of Economic Behavior & Organization from Elsevier
Bibliographic data for series maintained by Catherine Liu ().