increasing elasticity value functions (SIE) that is tractible and consistent with LP�s explanation of the magnitude e …: Anomalies of the discounted utility model, Hyperbolic discounting, Prospect theory, -delay, -subadditivity, SIE value … functions. JEL Classi�cation Codes: C60(General: Mathematical methods and program- ming); D91(Intertemporal consumer choice …

: Anomalies of the exponentially discounted utility model, the magnitude e�ect, the sign e�ect, SIE value functions. JEL Classi … value functions (3.1), v (x) is con- stant. For members of the HARA (3.2), CARA (3.3), logarithmic (3.4) and quadratic (3 … v dv dx = h(x). (4.2) This method only yields candidate value functions, which then have to be veri�ed. For example …

model, Hyperbolic discounting, Prospect theory, -delay, -subadditivity, SIE value functions. JEL Classi�cation Codes: C60 … generating value functions that exhibit increasing elasticity, as required to explain 6The �rst version of this paper was written … we call the class of simple increasing elasticity value functions (SIE). Each member of this class is formed by a product …

making over time. We show that the LP theory is incompatible with two very useful classes of value functions: the HARA class … value functions: the HARA class and the constant loss aversion class. Resultingly, the LP theory has been used infrequently … discounting, loss aversion, HARA utility functions, SIE value functions. JEL Classi�cation Codes: C60(General: Mathematical …