Intertemporal Uncertainty Avoidance: When the Future Is Uncertain, People Prefer the Present, and When the Present Is Uncertain, People Prefer the Future
David J. Hardisty () and
Jeffrey Pfeffer ()
Additional contact information
David J. Hardisty: Sauder School of Business, University of British Columbia, Vancouver, British Columbia V6T 1Z2, Canada
Jeffrey Pfeffer: Graduate School of Business, Stanford University, Stanford, California 94305
Management Science, 2017, vol. 63, issue 2, 519-527
Three studies explored the effects of uncertainty on people’s time preferences for financial gains and losses. In general, individuals seek to avoid uncertainty in situations of intertemporal choice. While holding the expected value of payouts constant, participants preferred immediate gains and losses if the future was uncertain, and preferred future gains and losses if the present was uncertain. This pattern of preferences is incompatible with current models of intertemporal choice, in which people should consistently prefer to have gains now and losses later. This pattern of uncertainty avoidance is also not explained by prospect theory models, which predict risk seeking for losses. We discuss these findings in relation to previous literature.Data, as supplemental material, are available at http://dx.doi.org/10.1287/mnsc.2015.2349 . This paper was accepted by Yuval Rottenstreich, judgment and decision making .
Keywords: utility preference; decision analysis; economics; behavior and behavioral decision making; probability (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations: Track citations by RSS feed
Downloads: (external link)
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:inm:ormnsc:v:63:y:2017:i:2:p:519-527
Access Statistics for this article
More articles in Management Science from INFORMS Contact information at EDIRC.
Bibliographic data for series maintained by Matthew Walls ().