Based on contrast effects studies from psychology, we predicted that movers arriving from more expensive cities would rent pricier apartments than those arriving from cheaper cities. We also predicted that as people stayed in their new city they would get used to the new prices and would...

Does current utility bias predictions of future utility for high stakes decisions? Here I provide field evidence consistent with such Projection Bias in one of life's most thought-about decisions: college enrolment. After arguing and documenting with survey evidence that cloudiness increases the...

Recent research has documented an 'endowment effect' whereby people become more attached to objects they receive than would be predicted from their prior desire to possess the object. In two experiments, the authors test whether people are aware of the effect--whether they realize that they will...

This paper presents a model of intertemporal choice that incorporates "savoring" and "dread"-i.e., utility from anticipat ion of delayed consumption. The model explains why an individual with positive time preference may delay desirable outcomes or get unpleas ant outcomes over with quickly,...