History-dependent random discounting

Youichiro Higashi, Kazuya Hyogo, Norio Takeoka

Research output: Chapter in Book/Report/Conference proceedingConference contribution

Abstract

In the literature of dynamic models under uncertainty, it is commonly assumed that uncertainty is resolved gradually over time and its resolution is independent of the actions taken by a decision maker up to that time period. However, contingencies in the decision maker's mind may change and even increase over time according to habits that have evolved by experiences, actions, or consumptions in the past. We provide an axiomatic model where the decision maker faces uncertainty about her own time preference or discount factors in future and these uncertainty may evolve according to histories or habits from the past consumption.

Original languageEnglish
Title of host publicationNumerical Analysis and Applied Mathematics - International Conference on Numerical Analysis and Applied Mathematics 2009, ICNAAM-2009
Pages965-968
Number of pages4
DOIs
Publication statusPublished - Nov 26 2009
EventInternational Conference on Numerical Analysis and Applied Mathematics 2009, ICNAAM-2009 - Rethymno, Crete, Greece
Duration: Sep 18 2009Sep 22 2009

Publication series

NameAIP Conference Proceedings
Volume1168
ISSN (Print)0094-243X
ISSN (Electronic)1551-7616

Other

OtherInternational Conference on Numerical Analysis and Applied Mathematics 2009, ICNAAM-2009
CountryGreece
CityRethymno, Crete
Period9/18/099/22/09

Keywords

  • Endogenous time preference
  • Habits
  • Preference for flexibility
  • Random discounting
  • Subjective states

ASJC Scopus subject areas

  • Physics and Astronomy(all)

Fingerprint Dive into the research topics of 'History-dependent random discounting'. Together they form a unique fingerprint.

  • Cite this

    Higashi, Y., Hyogo, K., & Takeoka, N. (2009). History-dependent random discounting. In Numerical Analysis and Applied Mathematics - International Conference on Numerical Analysis and Applied Mathematics 2009, ICNAAM-2009 (pp. 965-968). (AIP Conference Proceedings; Vol. 1168). https://doi.org/10.1063/1.3241646