Speaker: Prof. John Stachurski

Title: Quasi-hyperbolic discounting and dynamic choice: new results and their implications

Schedule: Oct 30, Wed 15:00-16:30

Location: 诚明楼 (Chengming Hall), Rm 315

Introduction: John Stachurski is a Professor at the Australian National University, working on dynamic optimization and distribution dynamics, with applications in economics and finance. He has published extensively in leading academic journals, such as Econometrica, Journal of Finance, Operations Research, Journal of Economic Theory, Theoretical Economics, and Automatica. He has also authored several widely recognized books, including Dynamic Programming, Economic Networks: Theory and Computation, Economic Dynamics: Theory and Computation, and A Primer in Econometric Theory. In addition, he co-founded the QuantEcon organization with Nobel Laureate Thomas Sargent, and has been the principal investigator for numerous prestigious research grants, including those from the Schmidt Futures Donor Advisor Fund, the Alfred P. Sloan Foundation (awarded three times), and the Australian Research Council Discovery Grant.

Abstract: Economic decision makers exhibit present bias, hyperbolic discounting and dynamic inconsistency. At the same time, existing solution concepts, such as stationary Markov Nash equilibrium and present-bias-naive-beliefs, are not well suited to deployment in large-scale quantitative models. In this research we study a very general dynamic optimization problem with present bias and clarify the optimal policy sequence. We then propose an alternative to existing solution concepts that exploits these optimality results while also matching partially inconsistent dynamic choices visible in the data.