Econometrica: Mar 1981, Volume 49, Issue 2
Myopic Economic Agents
Donald J. Brown, Lucinda M. LewisThis paper presents a model of myopic tastes, both in the context of intertemporal decision making and choice under uncertainty. Infinite dimensional consumption plans arise naturally in both contexts, either involving a denumerable number of periods or a countable number of states of the world. The essential feature of our model is that myopic behavior is formalized by defining topologies, on the space of consumption plans, which "discount" the future or improbable events.
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