Essays on Self-Control

Abstract

This dissertation concerns methods to test whether or not self-controlis costly, the form of temptation, and the affects different assumptionsabout costly self-control and temptation have on optimal borrowingand saving mechanisms. The second chapter shows that costly self-controland temptation can be differentiated from changing impatience in astochastic income consumption-savings environment. The third chapterdescribes an experiment to test whether subjects have time inconsistentpreferences, whether self-control is costly, and if so, whether thecost of self-control is time dependent. The fourth chapter describesthe affects on the optimal borrowing and savings mechanisms that assumptionsabout the myopia of temptation and the strength of costly self-controlhave.