Abstract
Most work on measuring opportunity is directed at ranking opportunity sets. This paper addresses the more general issue of assessing the opportunity provided by multi-period decision problems, focusing on the dynamic inconsistencies that can occur if agent’s preferences are unstable. A principle is proposed by which a dominance relation among outcomes iteratively induces a dominance relation among multi-period problems. This principle implies that opportunities to make sequences of individually reasonable actions have positive value, even if, because of dynamic inconsistency, those sequences lead to unambiguous loss. Opportunities which allow an agent to constrain herself are shown to have zero value.
Similar content being viewed by others
References
Arrow K (1995) A note on freedom and flexibility. In Basu K, Pattanaik P, Suzumura K (eds) Choice, welfare and development: a festschrift in honour of Amartya K. Sen, Clarendon Press, Oxford, pp 7–16
Camerer C, Issacharoff S, Loewenstein G, O’Donaghue T, Rabin M (2003) Regulation for conservatives: behavioral economics and the case for “asymmetric paternalism”. Univ Pennsylvania Law Rev 151:1211–1254
Cubitt R, Sugden R (2001) On money pumps. Games Econ Behav 37:121–160
Foster J (1993) Notes on effective freedom. Unpublished paper, Vanderbilt University.
Gul F, Pesendorfer W (2001) Temptation and self-control. Econometrica 69:1403–1435
Isen AM (1999) Positive affect. In Dalgleish T, Power M (eds) Handbook of cognition and emotion. Wiley, London
Jones P, Sugden R (1982) Evaluating choice. Int Rev Law Econ 2:47–65
Kreps D (1979) A representation theorem for “preference for flexibility”. Econometrica 47:565–577
Sen A (1970) Collective choice and social welfare. Oliver and Boyd, Edinburgh
Sugden R (1998) The metric of opportunity. Econ Philos 14:307–337
Sugden R (2003) Opportunity as a space for individuality: its value, and the impossibility of measuring it. Ethics 113:783–809
Sugden R (2004) The opportunity criterion: consumer sovereignty without the assumption of coherent preferences. Am Econ Rev 94:1014–1033
Sunstein C, Thaler R (2003) Libertarian paternalism. Am Econ Rev, Papers Proc 93(2):175–179
Author information
Authors and Affiliations
Corresponding author
Rights and permissions
About this article
Cite this article
Sugden, R. The value of opportunities over time when preferences are unstable. Soc Choice Welfare 29, 665–682 (2007). https://doi.org/10.1007/s00355-007-0250-3
Received:
Accepted:
Published:
Issue Date:
DOI: https://doi.org/10.1007/s00355-007-0250-3