OBESITY AND HYPERBOLIC DISCOUNTING: AN EXPERIMENTAL ANALYSIS

Timothy J. Richards, Stephen Hamilton and Geoffrey M. Pofahl

No 116410, 115th Joint EAAE/AAEA Seminar, September 15-17, 2010, Freising-Weihenstephan, Germany from European Association of Agricultural Economists

Abstract: Behavioral economists maintain that addictions such as alcoholism, smoking and over-eating represent examples of present-bias in decision making that is fundamentally irrational. In this article, we develop a model of present bias and apparently hyperbolic discounting that is fully consistent with rational behavior. We construct an experiment to test our hypothesis and to determine whether discount rates differ for individuals who engage in behaviors that could endanger their health. Our results show that discount functions are quasi-hyperbolic in shape, and that obesity and drinking are positively related to the discount rate. Anti-obesity policy, therefore, would be best directed to informing individuals as to the long-term implications of short-term gratification, rather than taxing foods directly.

Keywords: Agricultural and Food Policy; Consumer/Household Economics; Demand and Price Analysis; Food Consumption/Nutrition/Food Safety; Food Security and Poverty; Health Economics and Policy (search for similar items in EconPapers)
Pages: 32
Date: 2010
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Related works:
Journal Article: Obesity and Hyperbolic Discounting: An Experimental Analysis (2012)
Working Paper: Obesity and Hyperbolic Discounting: An Experimental Analysis (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:eaa115:116410

DOI: 10.22004/ag.econ.116410

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