This paper provides a framework for understanding preferences over utility streams across different time periods. We analyze preferences for the close future, for the distant future, and a synthesis of both, establishing a representation involving weights over time periods. Examining scenarios where two utility streams cannot be robustly compared to each other, we introduce notions in which one has more “potential” to be preferred over another, which lead to MaxMin, MaxMax, and -MaxMin representations. Finally, we consider temporal bias in the form of violations of stationarity. For close future preferences, we obtain a generalization of quasi-hyperbolic discounting. For distant future preferences, we obtain Banach limits and discuss the relationship with exponential discounting.
An α -MaxMin utility representation for close and distant future preferences with temporal biases
Résumé
en
This paper provides a framework for understanding preferences over utility streams across different time periods. We analyze preferences for the close future, for the distant future, and a synthesis of both, establishing a representation involving weights over time periods. Examining scenarios where two utility streams cannot be robustly compared to each other, we introduce notions in which one has more “potential” to be preferred over another, which lead to MaxMin, MaxMax, and -MaxMin representations. Finally, we consider temporal bias in the form of violations of stationarity. For close future preferences, we obtain a generalization of quasi-hyperbolic discounting. For distant future preferences, we obtain Banach limits and discuss the relationship with exponential discounting.
Auteur(s)
Jean-Pierre Drugeon1, 2
, Thai Ha-Huy3, 4
1
PSE -
Paris School of Economics
( 301309 )
- 48 boulevard Jourdan 75014 Paris
- France
Université Paris 1 Panthéon-Sorbonne ( 7550 )
;
École normale supérieure - Paris ( 59704 )
;
Université Paris Sciences et Lettres ( 564132 )
;
École des hautes études en sciences sociales ( 99539 )
;
École des Ponts ParisTech ( 301545 )
;
Centre National de la Recherche Scientifique ( 441569 )
;
Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement ( 577435 )
2
PJSE -
Paris Jourdan Sciences Economiques
( 578027 )
- 48 boulevard Jourdan 75014 Paris
- France
Université Paris 1 Panthéon-Sorbonne UMR8545 ( 7550 )
;
École normale supérieure - Paris ( 59704 )
;
Université Paris Sciences et Lettres ( 564132 )
;
École des hautes études en sciences sociales ( 99539 )
;
École des Ponts ParisTech ( 301545 )
;
Centre National de la Recherche Scientifique ( 441569 )
;
Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement UMR1393 ( 577435 )
3
Université Paris-Saclay
( 419361 )
- Bâtiment Bréguet, 3 Rue Joliot Curie 2e ét, 91190 Gif-sur-Yvette
- France
4
EPEE -
Centre d'Etudes des Politiques Economiques
( 1042269 )
- 4, boulevard François Mitterrand, 91025 EVRY CEDEX
- France
Université d'Évry-Val-d'Essonne EA 2177 ( 300306 )
;
Université Paris-Saclay ( 419361 )
Vulgarisation
Non
Comité de lecture
Oui
Audience
Internationale
Langue du document
Anglais
Nom de la revue
Journal of Mathematical Economics
(ISSN : 0304-4068)
Publié par Elsevier
Revue non référencée dans Sherpa-Romeo
Jean-Pierre Drugeon, Thai Ha-Huy. An α -MaxMin utility representation for close and distant future preferences with temporal biases. Journal of Mathematical Economics, 2023, 109, pp.102916. ⟨10.1016/j.jmateco.2023.102916⟩. ⟨halshs-04331306⟩