Share This Article:

Tempospect Theory of Intertemporal Choice

Abstract Full-Text HTML Download Download as PDF (Size:103KB) PP. 555-557
DOI: 10.4236/psych.2012.38082    4,303 Downloads   6,455 Views   Citations


Anomalies in intertemporal choice (e.g. hyperbolic discounting, subadditive discounting, a sign effect, a magnitude effect, and a delay-speedup asymmetry) have been investigated in neuroeconomics and behavioral neuroeconomics. In this study we propose a “tempospect” theory of intertemporal choice which can account for these anomalies in intertemporal choice. The key features of the present theory are: 1) decision over time is made with psychological time; and 2) psychological time is determined by a change in delay until receipt (i.e., positive or negative time-interval between options); 3) psychological time is less sensitive to a decrease in delay in comparison to an increase in delay; and 4) psychological time is influenced by the sign and magnitude of the delayed outcomes. Implications of the present theory for neuroeconomics are discussed.

Conflicts of Interest

The authors declare no conflicts of interest.

Cite this paper

Takahashi, T. & Han, R. (2012). Tempospect Theory of Intertemporal Choice. Psychology, 3, 555-557. doi: 10.4236/psych.2012.38082.


[1] Al-Nowaihi, A., & Dhami, S. (2006). A note on the Loewenstein-Prelec theory of intertemporal choice. Mathematical Social Sciences, 52, 99-108. doi:10.1016/j.mathsocsci.2006.04.001
[2] Al-Nowaihi, A., & Dhami, S. (2009). A value function that explains the magnitude and sign effects. Economics Letters, 105, 224-229. doi:10.1016/j.econlet.2009.08.004
[3] Bickel, W. K., & Marsch, L. A. (2001). Toward a behavioral economic understanding of drug dependence: Delay discounting processes. Addiction, 96, 73-86. doi:10.1046/j.1360-0443.2001.961736.x
[4] Cajueiro, D. (2006). A note on the relevance of the q-exponential function in the context of intertemporal choices. Physica A, 364, 385-388. doi:10.1016/j.physa.2005.08.056
[5] Destefano, N., & Martinez, A. (2011). The additive property of the inconsistency degree in intertemporal decision making through the generalization of psychophysical laws. Physica A, 390, 1763-1772. doi:10.1016/j.physa.2011.01.016
[6] Estle, S. J., Green, L., Myerson, J., & Holt, D. (2006). Differential effects of amount on temporal and probability discounting of gains and losses. Memory and Cognition, 34, 914-928. doi:10.3758/BF03193437
[7] Frederick, S., Loewenstein, G., & O’Donoghue, T. (2002). Time discounting and time preference: A critical review. Journal of Economic Literature, 40, 351-401. doi:10.1257/002205102320161311
[8] Kable, J., & Glimcher, P. (2007). The neural correlates of subjective value during intertemporal choice. Nature Neuroscience, 10, 1625- 1633. doi:10.1038/nn2007
[9] Kahneman, D., & Tversky, A. (1979). Prospect theory—Analysis of decision under risk. Econometrica, 47, 263-291. doi:10.2307/1914185
[10] Loewenstein, G. (1988). Frames of mind in intertemporal choice. Management Science, 34, 200-214. doi:10.1287/mnsc.34.2.200
[11] Loewenstein, G., & Prelec, D. (1992). Anomalies in intertemporal choice: Evidence and Interpretation. Quarterly Journal of Economics, 107, 573-597. doi:10.2307/2118482
[12] McClure, S., Laibson, D., Loewenstein, G., & Cohen, J. (2004). Separate neural systems value immediate and delayed monetary rewards. Science, 306, 503-507. doi:10.1126/science.1100907
[13] Read, D. (2001). Is time-discounting hyperbolic or subadditive? Journal of Risk Uncertainty, 23, 5-32. doi:10.1023/A:1011198414683
[14] Read, D., & Roelofsma, P. (2003). Subadditive versus hyperbolic discounting: A comparison of choice and matching. Organizational Behavior and Human Decision Processes, 91, 140-153. doi:10.1016/S0749-5978(03)00060-8
[15] Samuelson, P. (1937). A note on measurement of utility. Review of Economic Studie, 4, 155-161. doi:10.2307/2967612
[16] Scholten, M., & Read, D. (2010). The psychology of intertemporal tradeoffs. Psychological Review, 117, 925-944. doi:10.1037/a0019619
[17] Scholten, M., & Read, D. (2006). Discounting by intervals: A generalized model of intertemporal choice. Management Science, 52, 1424-1436. doi:10.1287/mnsc.1060.0534
[18] Strotz, R. H. (1955). Myopia and inconsistency in dynamic utility maximization. Review of Economic Studies, 23, 165-180. doi:10.2307/2295722
[19] Takahashi, T. (2005). Loss of self-control in intertemporal choice may be attributable to logarithmic time-perception. Medical Hypotheses, 65, 691-693. doi:10.1016/j.mehy.2005.04.040
[20] Takahashi, T. (2006). Time-estimation error following Weber-Fechner law may explain subadditive time-discounting. Medical Hypotheses, 67, 1372-1374. doi:10.1016/j.mehy.2006.05.056
[21] Thaler, R. H. (1981). Some empirical evidence on dynamic inconsistency. Economics Letters, 8, 201-207. doi:10.1016/0165-1765(81)90067-7
[22] Takahashi, T. (2007). A comparison of intertemporal choices for oneself versus someone else based on Tsallis' statistics. Physica A, 385, 637-644. doi:10.1016/j.physa.2007.07.020
[23] Takahashi, T., Oono, H., & Radford, M. (2007). Empirical estimation of consistency parameter in intertemporal choice based on Tsallis’ statistics. Physica A, 381, 338-342. doi:10.1016/j.physa.2007.03.038
[24] Takahashi, T. (2009). Theoretical frameworks for neuroeconomics of intertemporal choice. Journal of Neuroscience, Psychology, and Economics, 2, 75-90. doi:10.1037/a0015463
[25] Tversky, A., & Kahneman, D. (1992). Advances in prospect theory- cumulative representation of uncertainty. Journal of Risk and Uncertainty, 5, 297-323. doi:10.1007/BF00122574
[26] Zauberman, G., Kim, B., Malkoc, S., & Bettman, J. (2009). Discounting time and time discounting: Subjective time perception and intertemporal preferences. Journal of Marketing Research, 46, 543- 556. doi:10.1509/jmkr.46.4.543

comments powered by Disqus

Copyright © 2019 by authors and Scientific Research Publishing Inc.

Creative Commons License

This work and the related PDF file are licensed under a Creative Commons Attribution 4.0 International License.