Уақытша үйлесімсіздік және шешім қабылдаушының қалауларының өзгеруі

When a decision maker's future preferences can contradict earlier preferences

In economics, dynamic inconsistency or time inconsistency is a situation in which a decision maker's preferences change over time in such a way that a preference can become inconsistent at another point in time. This can be thought of as there being many different "selves" within decision makers, with each "self" representing the decision maker at a different point in time; the inconsistency occurs when not all preferences are aligned. The term "dynamic inconsistency" is more closely affiliated with game theory, whereas "time inconsistency" is more closely affiliated with behavioral economics.

In the context of game theory, dynamic inconsistency is a situation in a dynamic game where a player's best plan for some future period will not be optimal when that future period arrives. A dynamically inconsistent game is subgame imperfect. In this context, the inconsistency is primarily about commitment and credible threats. This manifests itself through a violation of Bellman's Principle of Optimality by the leader or dominant player, as shown in
For example, a firm might want to commit itself to dramatically dropping the price of a product it sells if a rival firm enters its market. If this threat were credible, it would discourage the rival from entering. However, the firm might not be able to commit its future self to taking such an action because if the rival does in fact end up entering, the firm's future self might determine that, given the fact that the rival is now actually in the market and there is no point in trying to discourage entry, it is now not in its interest to dramatically drop the price. As such, the threat would not be credible. The present self of the firm has preferences that would have the future self be committed to the threat, but the future self has preferences that have it not carry out the threat. Hence, the dynamic inconsistency.

Theories of media choice have not explicitly dealt with choice inconsistency as it was defined by behavioral economics. However, an article by Gui et al. (2021) draws on behavioral economics literature to address blind spots in theorization of inconsistent media selection in media studies. It also highlights that inconsistent choice is even more frequent and relevant in the digital environment, as higher stimulation and multitasking makes it easier to opt for immediate gratification even in the presence of different long term preferences.

In a game theory context, an announced government policy of never negotiating with terrorists over the release of hostages constitutes a time inconsistency example, since in each particular hostage situation the authorities face the dilemma of breaking the rule and trying to save the hostages. Assuming the government acted consistently in not ever breaking the rule, it would make it irrational for a terrorist group to take hostages. (Of course, in the real world terrorists might not act rationally.) Students, the night before an exam, often wish that the exam could be put off for one more day. If asked on that night, such students might agree to commit to paying, say, $10 on the day of the exam for it to be held the next day. Months before the exam is held, however, students generally do not care much about having the exam put off for one day. And, in fact, if the students were made the same offer at the beginning of the term, that is, they could have the exam put off for one day by committing during registration to pay $10 on the day of the exam, they probably would reject that offer. The choice is the same, although made at different points in time. Because the outcome would change depending on the point in time, the students would exhibit time inconsistency. Monetary policy makers suffer from dynamic inconsistency with inflation expectations, as politicians are best off promising lower inflation in the future. But once tomorrow comes lowering inflation may have negative effects, such as increasing unemployment, so they do not make much effort to lower it. This is why independent central banks are believed to be advantageous for a country. Indeed, "a central bank with a high degree of discretion in conducting monetary policy would find itself under constant political pressure to boost the economy and reduce unemployment, but since the economy cannot exceed its potential GDP or its natural rate of unemployment over time, this policy would instead only lead to higher inflation in the long run". The first paper on this subject was published by Finn E. Kydland and Edward C. Prescott in the Journal of Political Economy in 1977, which eventually led to their winning the Nobel Memorial Prize in Economic Sciences in 2004. (See also Monetary policy credibility.) One famous example in literature of a mechanism for dealing with dynamic inconsistency is that of Odysseus and the Sirens. Curious to hear the Sirens' songs but mindful of the danger, Odysseus orders his men to stop their ears with beeswax and ties himself to the mast of the ship. Most importantly, he orders his men not to heed his cries while they pass the Sirens; recognizing that in the future he may behave irrationally, Odysseus limits his future agency and binds himself to a commitment mechanism (i. e., the mast) to survive this perilous example of dynamic inconsistency. This example has been used by economists to explain the benefits of commitment mechanisms in mitigating dynamic inconsistency. A curious case of dynamic inconsistency in psychology is described by In the experiment, subjects of the study were offered free rentals of movies which were classified into two categories "lowbrow" (e. g., The Breakfast Club) and "highbrow" (e. g., Schindler's List) and researchers analyzed patterns of choices made. In the absence of dynamic inconsistency, the choice would be expected to be the same regardless of the delay between the decision date and the consumption date. In practice, however, the outcome was different. When subjects had to choose a movie to watch immediately, the choice was consistently lowbrow for the majority of the subjects. But when they were asked to pick a movie to be watched at later date, highbrow movies were chosen far more often. Among movies picked four or more days in advance, over 70% were highbrow. People display a consistent bias to believe that they will have more time in the future than they have today. Specifically, there is a persistent belief among people that they are "unusually busy in the immediate future, but will become less busy shortly". However, the amount of time you have this week is generally representative of the time you have in future weeks. When people are estimating their time and when deciding if they will make a commitment, they anticipate more "time slack" in future weeks than the present week. Experiments by on this topic showed that people tend to discount investments of time more than money. They nicknamed this the "Yes Damn!" effect because people tend to commit themselves to time consuming activities like traveling to a conference under the false impression that they will be less busy in the future.