Intertemporal Choice with Continuity Constraints
45 Pages Posted: 26 Aug 2018
Date Written: August 10, 2018
We consider a model of intertemporal choice where time is a continuum, the set of instantaneous outcomes (e.g. consumption bundles) is a topological space, and where intertemporal plans (e.g. consumption streams) must be continuous functions of time. We assume the agent can form preferences over plans defined on open time intervals. We axiomatically characterize the intertemporal preferences that admit a representation via discounted utility integrals. In this representation, the utility function is continuous and unique up to positive affine transformations, and the discount structure is represented by a unique Riemann-Stieltjes integral plus a unique linear functional measuring the long-run asymptotic utility.
Keywords: Intertemporal Choice; Intergenerational Social Choice; Technological Feasibility; Continuous Utility; Stone-Čech Compactification
JEL Classification: D15; D63; D90; H43; Q01
Suggested Citation: Suggested Citation