Time-inconsistent Preferences and Consumer Self-Control

TLDR

Consumers often act against their own better judgment, leading to regrettable behavior, and they struggle to maintain self‑control amid time‑inconsistent preferences. The article develops a decision‑theoretic model of consumer impatience based on reference points and discusses tactics for self‑control. The model portrays self‑control as a conflict between desire and willpower, explains sudden desire spikes that override long‑term preferences, and identifies two strategy classes—reducing desire and strengthening willpower. The model demonstrates that sudden increases in product desire can temporarily override long‑term preferences.

Abstract

Abstract Why do consumers sometimes act against their own better judgment, engaging in behavior that is often regretted after the fact and that would have been rejected with adequate forethought? More generally, how do consumers attempt to maintain self-control in the face of time-inconsistent preferences? This article addresses consumer impatience by developing a decision-theoretic model based on reference points. The model explains how and why consumers experience sudden increases in desire for a product, increases that can result in the temporary overriding of long-term preferences. Tactics that consumers use to control their own behavior are also discussed. Consumer self-control is framed as a struggle between two psychological forces, desire and willpower. Finally, two general classes of self-control strategies are described: those that directly reduce desire, and those that overcome desire through will power.