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ERIC Number: EJ1055995
Record Type: Journal
Publication Date: 2013-Jul
Pages: 21
Abstractor: As Provided
ISSN: ISSN-0278-7393
Time and Outcome Framing in Intertemporal Tradeoffs
Scholten, Marc; Read, Daniel
Journal of Experimental Psychology: Learning, Memory, and Cognition, v39 n4 p1192-1212 Jul 2013
A robust anomaly in intertemporal choice is the delay-speedup asymmetry: Receipts are discounted more, and payments are discounted less, when delayed than when expedited over the same interval. We developed 2 versions of the tradeoff model (Scholten & Read, 2010) to address such situations, in which an outcome is expected at a given time but then its timing is changed. The "outcome framing model" generalizes the approach taken by the hyperbolic discounting model (Loewenstein & Prelec, 1992): Not obtaining a positive outcome when expected is a worse than expected state, to which people are over-responsive, or hypersensitive, and not incurring a negative outcome when expected is a better than expected state, to which people are under-responsive, or hyposensitive. The "time framing model" takes a new approach: Delaying a positive outcome or speeding up a negative one involves a loss of time to which people are hypersensitive, and speeding up a positive outcome or delaying a negative one involves a gain of time to which people are hyposensitive. We compare the models on their quantitative predictions of indifference data from matching and preference data from choice. The time framing model systematically outperforms the outcome framing model.
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Publication Type: Journal Articles; Reports - Research
Education Level: N/A
Audience: N/A
Language: English
Sponsor: N/A
Authoring Institution: N/A
Identifiers - Location: Portugal
Grant or Contract Numbers: N/A