The standard continuous-time version of discounted utility does not possess the local inter-temporal substitution property (quantities consumed in nearby dates should be close substitutes, not complements), and hence does not define a continuous functional in the space of consumption paths. The...

The satiation utility model - a modification of discounted utility satisfying local substitution - predicts that optimal consumption sequences are U-shaped (high at the very beginning, constant in the middle, and high at the very end). To test this prediction we collect two datasets of musical...