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Article Dans Une Revue Economic Theory Année : 2021

On Markovian collective choice with heterogeneous quasi-hyperbolic discounting

Résumé

A general setup is considered where quasi-hyperbolic discounting agents differ in assuming heterogeneous bias for the present as well as heterogeneous discounting parameters, consumptions being, moreover, subject to a standard feasibility constraint. A collective utility function is defined as a linear combination of the inter-temporal utilities of the selves of the different agents, the elementary unit being thus the self of a given period of a given agent. Such a framework generating a tension between Pareto-optimality and time consistency for the optimal allocations, a new approach is introduced in order to tackle this issue. This builds from an a priori time-inconsistent collective utility function where the benevolent planner is to be apprehended in terms of a sequence of successive incarnations, any of these incarnations being endowed with its own objective. The associated optimal policy is the equilibrium of a game between the successive incarnations of the planner when the players follow Markovian strategies. This is compared with a more standard approach where restrictions would be imposed on the collective utility function that ensure the time consistency of the optimal decisions.
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Dates et versions

halshs-02973786 , version 1 (21-10-2020)

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Jean-Pierre Drugeon, Bertrand Wigniolle. On Markovian collective choice with heterogeneous quasi-hyperbolic discounting. Economic Theory, 2021, 72, pp.1257-1296. ⟨10.1007/s00199-020-01291-z⟩. ⟨halshs-02973786⟩
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