This website uses cookies.

By clicking the "Accept" button or continuing to browse our site, you agree to first-party and session-only cookies being stored on your device to enhance site navigation and analyze site performance and traffic. For more information on our use of cookies, please see our Privacy Policy.

  1. Home
  2. Journals
  3. American Economic Journal: Microeconomics
  4. November 2015
  5. Collective Dynamic Choice: The Necessity of Time Inconsistency

American Economic Journal:
Microeconomics

ISSN 1945-7669 (Print) | ISSN 1945-7685 (Online)

Collective Dynamic Choice: The Necessity of Time Inconsistency

  • Matthew O. Jackson
  • Leeat Yariv
American Economic Journal: Microeconomics
vol. 7, no. 4, November 2015
(pp. 150–78)
Download Full Text PDF

Abstract

We study collective decisions by time-discounting individuals choosing a common consumption stream. We show that with any heterogeneity in time preferences, every Pareto efficient and non-dictatorial method of aggregating utility functions must be time-inconsistent. We also show that decisions made via non-dictatorial voting methods are intransitive. (JEL D71, D72, D91)

Citation

Jackson, Matthew O., and Leeat Yariv. 2015. "Collective Dynamic Choice: The Necessity of Time Inconsistency." American Economic Journal: Microeconomics 7 (4): 150–78. DOI: 10.1257/mic.20140161

Additional Materials

JEL Classification

  • D71 Social Choice; Clubs; Committees; Associations
  • D72 Political Processes: Rent-seeking, Lobbying, Elections, Legislatures, and Voting Behavior
  • D15 Intertemporal Household Choice; Life Cycle Models and Saving