Time consistency and time invariance in collective intertemporal choice

Antony Millner and Geoffrey Heal

LSE Research Online Documents on Economics from London School of Economics and Political Science, LSE Library

Abstract: Recent work on collective intertemporal choice suggests that non-dictatorial social preferences are generically time inconsistent. We argue that this claim conflates time consistency with two distinct properties of preferences: stationarity and time invariance. While time invariance and stationarity together imply time consistency, the converse does not hold. Although non-dictatorial social preferences cannot be stationary, they may be time consistent if time invariance is abandoned. If individuals are discounted utilitarians, revealed preference provides no guidance on whether social preferences should be time consistent or time invariant. Nevertheless, we argue that time invariant social preferences are often normatively and descriptively problematic.

Keywords: collective decisions; intertemporal choice; time consistency (search for similar items in EconPapers)
JEL-codes: D60 D71 D90 (search for similar items in EconPapers)
Date: 2018-07-01
New Economics Papers: this item is included in nep-mic
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Citations: View citations in EconPapers (23)

Published in Journal of Economic Theory, 1, July, 2018, 176, pp. 158-169. ISSN: 1095-7235

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Journal Article: Time consistency and time invariance in collective intertemporal choice (2018)
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Persistent link: https://EconPapers.repec.org/RePEc:ehl:lserod:87429

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