You are not currently logged in.
Access JSTOR through your library or other institution:
Internalities and paternalism: applying the compensation criterion to multiple selves across time
Social Choice and Welfare
Vol. 38, No. 4, Symposium on Behavioural Economics (April 2012), pp. 601-615
Published by: Springer
Stable URL: http://www.jstor.org/stable/41485434
Page Count: 15
You can always find the topics here!Topics: Discounting, Cigarette smoking, Paternalism, Marginal utility, Utility functions, Laissez faire, Self, Utility maximization, Interest rates, Utility rates
Were these topics helpful?See something inaccurate? Let us know!
Select the topics that are inaccurate.
Preview not available
One reason to call an activity a vice and suppress it is that it reduces a person's future happiness more than it increases his present happiness. Gruber and Koszegi (Q J Econ 116(4): 1261—1303, 2001) show how a vice tax can increase a person's welfare in a model of multiple selves with hyperbolic preferences across time. The present paper shows that an interself analogy of the compensation criterion can justify a vice ban whether preferences are hyperbolic or exponential, but subject to the caveat that the person has a binding constraint on borrowing.
Social Choice and Welfare © 2012 Springer