Discounting Models for Outcomes over Continuous Time

Charles M.  Harvey; Lars Peter Østerdal

Discounting Models for Outcomes over Continuous Time

Charles M. Harvey, Lars Peter Østerdal

Department of Economics

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Abstract

Events that occur over a period of time can be described either as sequences of outcomes at discrete times or as functions of outcomes in an interval of
time. This paper presents discounting models for events of the latter type. Conditions on preferences are shown to be satisfied if and only if the
preferences are represented by a function that is an integral of a discounting function times a scale defined on outcomes at instants of time.

Original language	English
Publisher	Department of Economics, University of Copenhagen
Number of pages	28
Publication status	Published - Apr 2011

Series	University of Copenhagen. Institute of Economics. Discussion Papers (Online)
Number	12
Volume	2011
ISSN	1601-2461

Keywords

Faculty of Social Sciences

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Cite this

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