The effect of temporal constraints on the value of money and other commodities

Abstract

The value of hypothetical rewards of various delays and durations, consisting of money or other commodities, such as automobile use and vacations, was measured by the psychophysical up‐down staircase method using an amount of unrestricted immediate money as the titrated variable. A model of temporal discounting based on implied constraints on anticipated consumption rate described the data. Further explicit constraints on consumption produced predictable deviations from the model. The concept that consumption is normally constrained together with time discounting may also explain the interaction between amount and delay of monetary reward in determining value and may provide the basis for a theory of addiction based on learning to increase consumption rate.