2015/05/01 by Ted O'Donoghue, Ted O’Donoghue, Matthew Rabin · 14 citations
Decision Sciences · Economics, Econometrics and Finance · Business, Management and Accounting · #Decision-Making and Behavioral Economics #Economic theories and models #Consumer Market Behavior and Pricing
paper · doi:10.1257/aer.p20151085
While present bias is an old idea, it only took hold in economics following David Laibson's (1994) dissertation. Over the past 20 years, research has led to a much better theoretical understanding of present bias, when and how to apply it, and which ancillary assumptions are appropriate in different contexts. Empirical analyses have demonstrated how present bias can improve our understanding of behavior in various economic field contexts. Nonetheless, there is still much to learn. In this paper, we give our assessment of some lessons learned, and to be learned.