Hyperbolic discounting is not observationally equivalent to exponential discounting. It is always possible to calibrate an exponential model so that it predicts the same level of consumption as a hyperbolic model. However, the two models have radically different comparative statics.

According to Robert Fogel (1994a, 1994b), nutrition is the driving force for the increase in health human capital, which in turn has significantly promoted economic growth in the long run. In this paper, we take Fogel¡¯s finding to extend the standard Ramsey model by including the effect of...