ABSTRACT
Confronted with the prospect of marriage to Emma Wedgwood, Charles Darwin famously wrote down lists of pros, such as companionship in old age, and cons, such as disruption to his scientific work, and embarked on a cost-benefit decision analysis to help him make up his mind. Of course, these prospects were all in the future for him, but their remoteness varied enormously. The pleasure to be derived from having a companion in old age was at least 20 years off, whereas disruption to his work (from having to visit his wife’s relatives, say) might be only 1 or 2 years in the future. Thus, like many decision problems, time was a critical variable. Alternatives often have to be compared that will be realized at very different points in the future. In this chapter we consider some of the problems raised by these so called ‘intertemporal’ choice situations. (Thankfully – for the reputation of decision analysis – Charles and Emma were married in 1839.)
We begin, however, by considering an indirect influence of time on choice, namely via its common biasing effects on memory. We do not always remember events in a way that accurately reflects how they were experienced – indeed, our recollections often dramatically distort past events and how enjoyable or unpleasant they were. As an example, when students evaluated the enjoyment they were having during a particular type of vacation, their ratings did not predict how likely they were to repeat that type of vacation. That is to say, ratings taken during the vacation, as it was being experienced, did not determine future behaviour (Wirtz, Kruger, Scollon, & Diener, 2003). However, recollections of how enjoyable the vacation was did predict future behaviour. Moreover, ratings of expected enjoyment given before the vacation influenced later recalled enjoyment independently of experienced enjoyment during the vacation: one’s expectations have a long-lasting effect and are not overwritten by the actual experience. This raises the striking paradox that if you want to determine how likely it is someone will repeat an experience such as revisiting a restaurant, asking them during the experience will be less useful than seeking their subsequent remembered experience: How much they are enjoying the meal when they are actually in the restaurant will be less predictive than their later recollections of how enjoyable it was.
