A comparison of the discounted utility model and hyperbolic discounting models in the case of social and private intertemporal preferences for health

Marjon Pol van der, John Alexander Cairns

Research output: Contribution to journalArticle

29 Citations (Scopus)

Abstract

Whilst there is substantial evidence that hyperbolic discounting models describe intertemporal preferences for monetary outcomes better than the discounted utility (DU) model, there is only very limited evidence in the context of health outcomes. This study elicits private and social intertemporal preferences for non-fatal changes in health. Specific functional forms of the DU model and three hyperbolic models are fitted, The results show that the stationarity axiom is violated, and that the hyperbolic models fit the data better than the DU model. Intertemporal preferences for private and social decisions are found to be very similar. (C) 2002 Published by Elsevier Science B.V.

Original languageEnglish
Pages (from-to)79-96
Number of pages17
JournalJournal of Economic Behavior and Organization
Volume49
Issue number1
DOIs
Publication statusPublished - Sep 2002

Keywords

  • stationarity
  • hyperbolic discounting
  • health
  • DECREASING TIMING AVERSION
  • TIME PREFERENCE
  • DELAYED REWARDS
  • SAVING LIVES
  • CHOICE
  • DECISIONS
  • REVERSALS
  • ANOMALIES

Cite this

@article{1130941f9f034902a534f2829a4e55f7,
title = "A comparison of the discounted utility model and hyperbolic discounting models in the case of social and private intertemporal preferences for health",
abstract = "Whilst there is substantial evidence that hyperbolic discounting models describe intertemporal preferences for monetary outcomes better than the discounted utility (DU) model, there is only very limited evidence in the context of health outcomes. This study elicits private and social intertemporal preferences for non-fatal changes in health. Specific functional forms of the DU model and three hyperbolic models are fitted, The results show that the stationarity axiom is violated, and that the hyperbolic models fit the data better than the DU model. Intertemporal preferences for private and social decisions are found to be very similar. (C) 2002 Published by Elsevier Science B.V.",
keywords = "stationarity, hyperbolic discounting, health, DECREASING TIMING AVERSION, TIME PREFERENCE, DELAYED REWARDS, SAVING LIVES, CHOICE, DECISIONS, REVERSALS, ANOMALIES",
author = "{Pol van der}, Marjon and Cairns, {John Alexander}",
year = "2002",
month = "9",
doi = "10.1016/S0167-2681(02)00059-8",
language = "English",
volume = "49",
pages = "79--96",
journal = "Journal of Economic Behavior and Organization",
issn = "0167-2681",
publisher = "Elsevier",
number = "1",

}

TY - JOUR

T1 - A comparison of the discounted utility model and hyperbolic discounting models in the case of social and private intertemporal preferences for health

AU - Pol van der, Marjon

AU - Cairns, John Alexander

PY - 2002/9

Y1 - 2002/9

N2 - Whilst there is substantial evidence that hyperbolic discounting models describe intertemporal preferences for monetary outcomes better than the discounted utility (DU) model, there is only very limited evidence in the context of health outcomes. This study elicits private and social intertemporal preferences for non-fatal changes in health. Specific functional forms of the DU model and three hyperbolic models are fitted, The results show that the stationarity axiom is violated, and that the hyperbolic models fit the data better than the DU model. Intertemporal preferences for private and social decisions are found to be very similar. (C) 2002 Published by Elsevier Science B.V.

AB - Whilst there is substantial evidence that hyperbolic discounting models describe intertemporal preferences for monetary outcomes better than the discounted utility (DU) model, there is only very limited evidence in the context of health outcomes. This study elicits private and social intertemporal preferences for non-fatal changes in health. Specific functional forms of the DU model and three hyperbolic models are fitted, The results show that the stationarity axiom is violated, and that the hyperbolic models fit the data better than the DU model. Intertemporal preferences for private and social decisions are found to be very similar. (C) 2002 Published by Elsevier Science B.V.

KW - stationarity

KW - hyperbolic discounting

KW - health

KW - DECREASING TIMING AVERSION

KW - TIME PREFERENCE

KW - DELAYED REWARDS

KW - SAVING LIVES

KW - CHOICE

KW - DECISIONS

KW - REVERSALS

KW - ANOMALIES

U2 - 10.1016/S0167-2681(02)00059-8

DO - 10.1016/S0167-2681(02)00059-8

M3 - Article

VL - 49

SP - 79

EP - 96

JO - Journal of Economic Behavior and Organization

JF - Journal of Economic Behavior and Organization

SN - 0167-2681

IS - 1

ER -