Abstract
Models of rational addiction suggest that obesity is consistent with time-consistent preferences. Behavioral economists maintain that addictions such as alcoholism, smoking and over-eating represent examples of present-bias in decision making that is fundamentally irrational. In this article, conduct an experiment to test whether individual discount schedules are time-consistent and whether discount rates are higher for subjects who exhibit patterns of risky behavior. Our results show that discount functions are quasi-hyperbolic in shape, and that obesity and drinking are positively related to the discount rate. Anti-obesity policy, therefore, would be best directed to informing individuals as to the long-term implications of short-term gratification, rather than taxing foods directly.
Original language | English (US) |
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Pages (from-to) | 181-198 |
Number of pages | 18 |
Journal | Journal of Agricultural and Resource Economics |
Volume | 37 |
Issue number | 2 |
State | Published - Aug 1 2012 |
Keywords
- Addiction
- Discounting
- Experiments
- Hyperbolic
- Obesity
- Time-inconsistency
ASJC Scopus subject areas
- Animal Science and Zoology
- Agronomy and Crop Science
- Economics and Econometrics