Time inconsistency

From Market
Jump to: navigation, search
This article gives a basic definition in behavioral economics.
View a complete list of basic definitions in behavioral economics


Time inconsistency, also called dynamic inconsistency, is the phenomenon whereby a person's tastes and preference change over time, leading to a different evaluation of the costs and benefits of a certain decision. For instance, time inconsistency may refer to the difference between the value a person puts to anticipating something, the value the person puts to experiencing it, and the value the person places on having experienced it.

Types of time inconsistency