Projection bias in effort choices

DOI10.1016/J.GEB.2022.07.002MaRDI QIDQ2675458zbMATH OpenOpenAlexFDO

Authors Marc Kaufmann

Publication date 23 September 2022

Published in Games and Economic Behavior (Search for Journal in Brave)

Full work available at URL https://arxiv.org/abs/2104.04327

zbMATH Keywords

increasing returnsmulti-taskingprojection biastime inconsistency

Mathematics Subject Classification ID

Decision theory (91B06)

Abstract: Working becomes harder as we grow tired or bored. I model individuals who underestimate these changes in marginal disutility -- as implied by "projection bias" -- when deciding whether or not to continue working. This bias causes people's plans to change: early in the day when they are rested, they plan to work more than late in the day when they are rested. Despite initially overestimating how much they will work, people facing a single task with decreasing returns to effort work optimally. However, when facing multiple tasks, they misprioritize urgent but unimportant over important but non-urgent tasks. And when they face a single task with all-or-nothing rewards (such as being promoted) they start, and repeatedly work on, some overly ambitious tasks that they later abandon. Each day they stop working once they have grown tired, which can lead to large daily welfare losses. Finally, when they have either increasing or decreasing productivity, people work less each day than previously planned. This moves people closer to optimal effort for decreasing, and further away from optimal effort for increasing productivity.

Recommendations

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Cites work

• An experiment on time preference and misprediction in unpleasant tasks
• Choice and procrastination
• Goal-setting and self-control
• Golden Eggs and Hyperbolic Discounting
• Instantaneous Gratification *
• Model-based evaluation of cooling-off policies
• Naivete about temptation and self-control: foundations for recursive naive quasi-hyperbolic discounting
• Present-bias, procrastination and deadlines in a field experiment
• Projection Bias in Predicting Future Utility
• Self-control in peer groups
• Something in the Air: Pollution and the Demand for Health Insurance
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Cited in

(4)

• Planning on an empty stomach: on agents with projection bias
• Projection Bias in Predicting Future Utility
• Optimal contracts under interpersonal projection
• Information projection and selective search: implement now or draw again

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