Discount models in intertemporal choice: an empirical analysis

Purpose: The main purpose of this paper is to determine the discount function which better fits the individuals' preferences through the empirical analysis of the different functions used in the field of intertemporal choice. Design/methodology/approach: After an in-depth revision of the existi...

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Detalles Bibliográficos
Autores: Parra Oller, Isabel María, Cruz Rambaud, Salvador, Valls Martínez, María del Carmen
Tipo de recurso: artículo
Fecha de publicación:2020
País:España
Institución:Universidad Autónoma de Madrid
Repositorio:Biblos-e Archivo. Repositorio Institucional de la UAM
Idioma:inglés
OAI Identifier:oai:repositorio.uam.es:10486/702456
Acceso en línea:http://hdl.handle.net/10486/702456
https://dx.doi.org/10.1108/EJMBE-01-2019-0003
Access Level:acceso abierto
Palabra clave:Discount function
Discounted utility model
Empirical analysis
Intertemporal choice
Preferences
Economía
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spelling Discount models in intertemporal choice: an empirical analysisParra Oller, Isabel MaríaCruz Rambaud, SalvadorValls Martínez, María del CarmenDiscount functionDiscounted utility modelEmpirical analysisIntertemporal choicePreferencesEconomíaPurpose: The main purpose of this paper is to determine the discount function which better fits the individuals' preferences through the empirical analysis of the different functions used in the field of intertemporal choice. Design/methodology/approach: After an in-depth revision of the existing literature and unlike most studies which only focus on exponential and hyperbolic discounting, this manuscript compares the adjustment of data to six different discount functions. To do this, the analysis is based on the usual statistical methods, and the non-linear least squares regression, through the algorithm of Gauss-Newton, in order to estimate the models' parameters; finally, the AICc method is used to compare the significance of the six proposed models. Findings: This paper shows that the so-called q-exponential function deformed by the amount is the model which better explains the individuals' preferences on both delayed gains and losses. To the extent of the authors' knowledge, this is the first time that a function different from the general hyperbola fits better to the individuals' preferences. Originality/value: This paper contributes to the search of an alternative model able to explain the individual behavior in a more realistic wayThis paper has been partially supported by the project “La sostenibilidad del sistema nacional de salud: reformas, estrategias y propuestas,” reference: DER2016- 76053-R, Ministry of Economy and CompetitivenessEmeraldDepartamento de Financiación e Investigación ComercialFacultad de Ciencias Económicas y Empresariales20202020-04-08research articlehttp://purl.org/coar/resource_type/c_2df8fbb1VoRhttp://purl.org/coar/version/c_970fb48d4fbd8a85info:eu-repo/semantics/articleapplication/pdfhttp://hdl.handle.net/10486/702456https://dx.doi.org/10.1108/EJMBE-01-2019-0003reponame:Biblos-e Archivo. Repositorio Institucional de la UAMinstname:Universidad Autónoma de MadridInglésengopen accesshttp://purl.org/coar/access_right/c_abf2info:eu-repo/semantics/openAccessoai:repositorio.uam.es:10486/7024562026-06-23T12:46:27Z
dc.title.none.fl_str_mv Discount models in intertemporal choice: an empirical analysis
title Discount models in intertemporal choice: an empirical analysis
spellingShingle Discount models in intertemporal choice: an empirical analysis
Parra Oller, Isabel María
Discount function
Discounted utility model
Empirical analysis
Intertemporal choice
Preferences
Economía
title_short Discount models in intertemporal choice: an empirical analysis
title_full Discount models in intertemporal choice: an empirical analysis
title_fullStr Discount models in intertemporal choice: an empirical analysis
title_full_unstemmed Discount models in intertemporal choice: an empirical analysis
title_sort Discount models in intertemporal choice: an empirical analysis
dc.creator.none.fl_str_mv Parra Oller, Isabel María
Cruz Rambaud, Salvador
Valls Martínez, María del Carmen
author Parra Oller, Isabel María
author_facet Parra Oller, Isabel María
Cruz Rambaud, Salvador
Valls Martínez, María del Carmen
author_role author
author2 Cruz Rambaud, Salvador
Valls Martínez, María del Carmen
author2_role author
author
dc.contributor.none.fl_str_mv Departamento de Financiación e Investigación Comercial
Facultad de Ciencias Económicas y Empresariales
dc.subject.none.fl_str_mv Discount function
Discounted utility model
Empirical analysis
Intertemporal choice
Preferences
Economía
topic Discount function
Discounted utility model
Empirical analysis
Intertemporal choice
Preferences
Economía
description Purpose: The main purpose of this paper is to determine the discount function which better fits the individuals' preferences through the empirical analysis of the different functions used in the field of intertemporal choice. Design/methodology/approach: After an in-depth revision of the existing literature and unlike most studies which only focus on exponential and hyperbolic discounting, this manuscript compares the adjustment of data to six different discount functions. To do this, the analysis is based on the usual statistical methods, and the non-linear least squares regression, through the algorithm of Gauss-Newton, in order to estimate the models' parameters; finally, the AICc method is used to compare the significance of the six proposed models. Findings: This paper shows that the so-called q-exponential function deformed by the amount is the model which better explains the individuals' preferences on both delayed gains and losses. To the extent of the authors' knowledge, this is the first time that a function different from the general hyperbola fits better to the individuals' preferences. Originality/value: This paper contributes to the search of an alternative model able to explain the individual behavior in a more realistic way
publishDate 2020
dc.date.none.fl_str_mv 2020
2020-04-08
dc.type.none.fl_str_mv research article
http://purl.org/coar/resource_type/c_2df8fbb1
VoR
http://purl.org/coar/version/c_970fb48d4fbd8a85
dc.type.openaire.fl_str_mv info:eu-repo/semantics/article
format article
dc.identifier.none.fl_str_mv http://hdl.handle.net/10486/702456
https://dx.doi.org/10.1108/EJMBE-01-2019-0003
url http://hdl.handle.net/10486/702456
https://dx.doi.org/10.1108/EJMBE-01-2019-0003
dc.language.none.fl_str_mv Inglés
eng
language_invalid_str_mv Inglés
language eng
dc.rights.none.fl_str_mv open access
http://purl.org/coar/access_right/c_abf2
dc.rights.openaire.fl_str_mv info:eu-repo/semantics/openAccess
rights_invalid_str_mv open access
http://purl.org/coar/access_right/c_abf2
eu_rights_str_mv openAccess
dc.format.none.fl_str_mv application/pdf
dc.publisher.none.fl_str_mv Emerald
publisher.none.fl_str_mv Emerald
dc.source.none.fl_str_mv reponame:Biblos-e Archivo. Repositorio Institucional de la UAM
instname:Universidad Autónoma de Madrid
instname_str Universidad Autónoma de Madrid
reponame_str Biblos-e Archivo. Repositorio Institucional de la UAM
collection Biblos-e Archivo. Repositorio Institucional de la UAM
repository.name.fl_str_mv
repository.mail.fl_str_mv
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