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Interpersonal Allocation Continuous with Intertemporal Allocation

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  • Julian L. Simon

    (University of Maryland)

Abstract

Gifts and bequests trouble economic theory. A solution is to deal similarly with distributions for consumption among (a) the current person, (b)future self-persons who are legally and physically the same individual who is allocating, and (c) other individuals at present and in the future. Instead of a one-dimensional maximizing entity, or even the two-dimensional individual who allocates intertemporally, this model envisages a three-dimensional surface, with an interpersonal "distance" dimension replacing the concept of altruism. A key assumption, as in Strotzian intertemporal allocations, is that the discount between the current conscious "person" and future "self-persons" within the same individual is greater than the discount between other equal-length forward periods within the same individual. Applying a conventional present-value framework to evaluate utility, as seen at various decision-making moments, then makes sense of the phenomena under discussion.

Suggested Citation

  • Julian L. Simon, 1995. "Interpersonal Allocation Continuous with Intertemporal Allocation," Rationality and Society, , vol. 7(4), pages 367-392, October.
    • Handle: RePEc:sae:ratsoc:v:7:y:1995:i:4:p:367-392
    DOI: 10.1177/104346319500700402
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    References listed on IDEAS

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    Cited by:

    1. Breuer, Wolfgang & Müller, Torbjörn & Sachsenhausen, Eric, 2022. "The determinants of discounting in intergenerational decision-making," European Economic Review, Elsevier, vol. 148(C).
    2. David Sally, 1995. "Gifts with Strings Attached," Rationality and Society, , vol. 7(4), pages 416-420, October.
    3. Preston Greene, 2024. "Social bias, not time bias," Politics, Philosophy & Economics, , vol. 23(1), pages 100-121, February.
    4. Dennis C. Mueller, 1995. "On Modeling Interpersonal Behavior," Rationality and Society, , vol. 7(4), pages 404-415, October.
    5. Osiński, Jerzy & Karbowski, Adam & Rusek, Jan, 2017. "The relationship between self-control and altruism in the light of discounting literature," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 48(4), pages 433-439.
    6. Benjamin Volland, 2018. "Après nous le déluge? Perceived distance of climate change impacts and pro-environmental behaviour," IRENE Working Papers 18-05, IRENE Institute of Economic Research.
    7. George Ainslie, 1995. "A Utility-Maximizing Mechanism for Vicarious Reward," Rationality and Society, , vol. 7(4), pages 393-403, October.
    8. Tina Strombach & Zsofia Margittai & Barbara Gorczyca & Tobias Kalenscher, 2016. "Gender-Specific Effects of Cognitive Load on Social Discounting," PLOS ONE, Public Library of Science, vol. 11(10), pages 1-15, October.

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