Optimal Time-Inconsistent Beliefs: Misplanning, Procrastination, and Commitment
نویسندگان
چکیده
منابع مشابه
Optimal Time-Inconsistent Beliefs: Misplanning, Procrastination, and Commitment
We develop a structural theory of beliefs and behavior that relaxes the assumption of time consistency in beliefs. Our theory is based on the trade-off between optimism, which raises anticipatory utility, and objectivity, which promotes efficient actions. We present it in the context of allocating work on a project over time, develop testable implications to contrast it with models assuming tim...
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In this paper we model a decision maker who must exert costly effort to complete a single task by a fixed deadline. Effort costs evolve stochastically in continuous time. The decision maker will then optimally wait to exert effort until costs are less than a given threshold, the solution to an optimal stopping time problem. We derive the solution to this model for three cases: (1) time consiste...
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I study the optimal supply of exible commitment devices to people who value both commitment and exibility, and whose preferences exhibit varying degrees of time inconsistency. I nd that, if time inconsistency is observable, then both a monopolist and a planner supply devices that enable each person to commit to the e¢ cient level of exibility. If instead time inconsistency is unobservable, ...
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ژورنال
عنوان ژورنال: Management Science
سال: 2017
ISSN: 0025-1909,1526-5501
DOI: 10.1287/mnsc.2015.2360