A new test of convexity–concavity of discount function

Theory and Decision 89 (2):121-136 (2020)
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Abstract

Discounted utility theory and its generalizations use discount functions for weighting utilities of outcomes received in different time periods. We propose a new simple test of convexity–concavity of discount function. This test can be used with any utility function and any preferences over risky lotteries. The data from a controlled laboratory experiment show that about one third of experimental subjects reveal a concave discount function and another one third of subjects reveal a convex discount function.

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Cognitive Reflection and Decision Making.Shane Frederick - 2005 - Journal of Economic Perspectives 19 (4):25-42.
A note on measurement of utility.Paul Samuelson - 1937 - The Review of Economic Studies 4 (2):155–61.

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