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Consistency Among Elicitation Techniques for Intertemporal Choice: A Within-Subjects Investigation of the Anomalies

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  • Jeffery L. Guyse

    (Technology and Operations Management, College of Business Administration, California State Polytechnic University, Pomona, California 91768)

  • Jay Simon

    (Defense Resources Management Institute, Naval Postgraduate School, Monterey, California 93943)

Abstract

The equivalence of two elicitation methods (sequences and matching) has been assumed when empirically testing the traditional discounting model even though the respective literature has revealed results that are dependent on the procedure used. Three common anomalies revealed (gain/loss asymmetry, short/long asymmetry, and the absolute magnitude effect) are investigated using the two different methods in a within-subjects experiment. In both procedures, it appears that the participants in this study evaluate monetary outcomes over time differently than the discounting model predicts. Patterns consistent with two of the anomalies (gain/loss and absolute magnitude effect) surface and interact in both elicitation techniques. Finally, a systematic inconsistency exists between the two methods. We observe significantly more consistency between the two elicitation techniques when the outcome is a gain in the relatively far future than when it is a future loss. This may be due to the participants' inability to display a preference for spreading losses, which they revealed in the sequences task, in the matching task.

Suggested Citation

  • Jeffery L. Guyse & Jay Simon, 2011. "Consistency Among Elicitation Techniques for Intertemporal Choice: A Within-Subjects Investigation of the Anomalies," Decision Analysis, INFORMS, vol. 8(3), pages 233-246, September.
    • Handle: RePEc:inm:ordeca:v:8:y:2011:i:3:p:233-246
    DOI: 10.1287/deca.1110.0212
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    Cited by:

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    3. Alexander Adamou & Yonatan Berman & Diomides Mavroyiannis & Ole Peters, 2021. "Microfoundations of Discounting," Decision Analysis, INFORMS, vol. 18(4), pages 257-272, December.
    4. repec:cup:judgdm:v:8:y:2013:i:3:p:236-249 is not listed on IDEAS
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    6. L. Robin Keller, 2011. "From the Editor ---Multiattribute and Intertemporal Preferences, Probability, and Stochastic Processes: Models and Assessment," Decision Analysis, INFORMS, vol. 8(3), pages 165-169, September.
    7. Cruz Rambaud, Salvador & Ortiz Fernández, Piedad & Parra Oller, Isabel María, 2023. "A systematic review of the main anomalies in intertemporal choice," Journal of Behavioral and Experimental Economics (formerly The Journal of Socio-Economics), Elsevier, vol. 104(C).

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