Menu-dependent self-control

Abstract

The literature on self-control problems has typically put forth models that imply behavior that is consistent with the weak axiom of revealed preference (WARP). We argue that when choice is the outcome of some underlying internal conflict, the resulting choices may not be perfectly consistent across choice problems: an agent’s ability to resist temptation may well depend on what alternatives are available to him. We generalize Gul and Pesendorfer (2001) so that self-control weakens in the presence of temptation. To model choices from menus explicitly, we consider a choice correspondence as well as a preference over menus and relax both the Independence axiom for the preference and the WARP condition for the choice correspondence. The model is shown to unify a range of well-known findings in the experimental literature on choice under risk and over time within a single specification.