On the waiting thing, my intuitions say to take the $120 tomorrow, so I might be unrepresentative—but couldn’t this be explained just as well in terms of whether you have to wait at all, not necessarily just the specific amount of a day? Would you get similar results if you offered $100 tomorrow or $120 the day after? That way you have to wait either way.
I assume that’s the point of the thirty-days-out version of the experiment—imposing a delay on either amount. Or were you wondering if it comes into play even for so small a delay? That is, where’s the cutoff at which people will switch between the two behaviors?
I would also take $120 tomorrow, but I’m also poor enough that an extra $20 is a big deal. There’s another way the percentage thing comes into play: the ratio of the potential gain to one’s current funds.
Or were you wondering if it comes into play even for so small a delay? That is, where’s the cutoff at which people will switch between the two behaviors?
I’d guess that any delay that gives the other party a chance to back out would be sufficient. When determining the expected utility of each offer, there should be a term for the probability of the deal actually going through. That’s very close to 1 when you take the $100 now and less if you have to wait a day for $120, which might tip the balance toward the $100. But the probabilities are nearly identical for 30 and 31 days, so $120 is the better choice there.
Good point. It might be interesting to try to find a money delta (ie, $100 vs. $200 or whatever) where someone would take the earlier one at 30 vs. 31 days, but the larger one at 90 vs. 91 days. But I’m not sure how much that would prove.
On the waiting thing, my intuitions say to take the $120 tomorrow, so I might be unrepresentative—but couldn’t this be explained just as well in terms of whether you have to wait at all, not necessarily just the specific amount of a day? Would you get similar results if you offered $100 tomorrow or $120 the day after? That way you have to wait either way.
Not waiting at all is just the extreme form of this, as waiting would increase the time by infinity percent.
I assume that’s the point of the thirty-days-out version of the experiment—imposing a delay on either amount. Or were you wondering if it comes into play even for so small a delay? That is, where’s the cutoff at which people will switch between the two behaviors?
I would also take $120 tomorrow, but I’m also poor enough that an extra $20 is a big deal. There’s another way the percentage thing comes into play: the ratio of the potential gain to one’s current funds.
Yes, this is about what I had in mind.
I’d guess that any delay that gives the other party a chance to back out would be sufficient. When determining the expected utility of each offer, there should be a term for the probability of the deal actually going through. That’s very close to 1 when you take the $100 now and less if you have to wait a day for $120, which might tip the balance toward the $100. But the probabilities are nearly identical for 30 and 31 days, so $120 is the better choice there.
Good point. It might be interesting to try to find a money delta (ie, $100 vs. $200 or whatever) where someone would take the earlier one at 30 vs. 31 days, but the larger one at 90 vs. 91 days. But I’m not sure how much that would prove.