Behavioral economic demand modeling chronology, complexities, and considerations: Much ado about zeros

Reliability and validity of behavioral-economic measures: A review and synthesis of discounting and demand

This review sought to synthesize the literature on the reliability and validity of behavioral-economic measures of demand and discounting in human research, introduce behavioral-economic research methodologies for studying addictive behaviors, discuss gaps in the current literature, and review areas for future research. A total of 34 studies was included in this review. The discounting literature showed similar responding regardless of whether hypothetical or actual outcomes were used, though people tended to discount the outcome presented first more steeply, suggesting order effects. Although delay-discounting measures seem to show temporal stability, exceptions were found for probability- and experiential-discounting tasks. The demand literature also demonstrated similar responding regardless of outcome type; however, some demand indices showed exceptions. Randomized price sequences tended to show modest increases in Omax and α and modestly higher rates of inconsistent or nonsystematic responses compared with sequential price sequences. Demand indices generally showed temporal stability, although the stability was weaker the larger the time interval between test sessions. Future studies would benefit by examining addictive commodities beyond alcohol, nicotine, and money; examining temporal stability over longer time intervals; using larger delays in discounting tasks; and using larger sample sizes.

Hyperbolic discounting and exponentiated demand: Modeling demand for cigarettes in three dimensions

Behavioral economics has been a fruitful area of research in substance use. Mathematical descriptions of how individuals temporally discount the value of a commodity have been correlated with substance use and mathematical descriptions of drug consumption decreasing as a function of price (i.e., demand) predict maladaptive substance use. While there is a logical assumption that temporal factors affect demand for a drug, little has been done to merge these models. Thus, the purpose of this study was to combine models of discounting and demand, extending Howard Rachlin's work and contributions to novel areas of study. Data from 85 participants from Amazon Mechanical Turk (MTurk) who completed a hypothetical cigarette purchase task that included price of and delay to cigarettes were analyzed. Multilevel modeling was used to determine descriptive accuracy of combined additive and multiplicative models of discounting and demand. Of the discounting models used in conjunction with the exponentiated demand equation, the Rachlin hyperboloid best described the delay dimension of consumption. The multiplicative version of the Rachlin equation applied to both delay and price outperformed other models tested. Therefore, existing models of discounting and demand can be extended to modeling consumption data from complex multidimensional experimental arrangements.