Intertemporal Choice is decisions involve trade-offs between costs and benefits at different times. It sits in the Cognition dimension (COG) of the Human Behavior Taxonomy™ as element HBT-COG-0411, within the Economics family. The core principle: decisions involve trade-offs between costs and benefits at different times. In incentive terms, it matters because it changes the payoff people perceive before they choose — which means it can be designed for, or exploited.
Scientific Definition
Decisions involve trade-offs between costs and benefits at different times.
Plain-English Definition
Decisions involve trade-offs between costs and benefits at different times.
Feynman Explanation
Now-you and future-you are not always on the same team.
Core Principle
Decisions involve trade-offs between costs and benefits at different times.
Mechanisms
Pending editorial review.
Decisions involve trade-offs between costs and benefits at different times.
Pending editorial review.
Pending editorial review.
Pending editorial review.
Pending editorial review.
Capital allocation is intertemporal choice at scale.
Inputs (Triggers)
Pending editorial review.
Outputs (Behaviors)
Pending editorial review.
Behavioral Signature
Now-you and future-you are not always on the same team.
Examples
- Investing today for returns tomorrow, or spending today and regretting tomorrow.
- Capital allocation is intertemporal choice at scale.
Pending editorial review.
Original analysis from The Incentives Lab — how this element behaves inside real payoff structures.
Why this element matters to incentive design
This element is common enough to feel like human nature and specific enough to be engineered around. The mechanism underneath it is straightforward: decisions involve trade-offs between costs and benefits at different times. You can recognize it in the field by its signature: now-you and future-you are not always on the same team. Every element in the Cognition dimension changes the perceived payoff of an action before the action happens, which is exactly where incentive design has leverage.
How it gets exploited
Left undesigned, capital allocation is intertemporal choice at scale. It is amplified whenever capital allocation is intertemporal choice at scale. Inside organizations that shows up as capital allocation is intertemporal choice at scale. The pattern is the same one Goodhart's Law describes: the measurable proxy attracts the effort, and the purpose behind it quietly loses funding.
How the Lab designs around it
The redesign move is to use explicit discount rates and future-self empathy exercises. Watch for it at the boundaries: handoffs, promotions, incident reviews, and budget cycles are where this element gets its power.
Famous Experiments
Pending editorial review.
Design Principles
- Use explicit discount rates and future-self empathy exercises.
Measurement Approaches
Pending editorial review.
Evidence
Pending editorial review.
Pending editorial review.
The Perverse Incentive Lens™
How this behavior is exploited — and how to redesign around it.
- Use explicit discount rates and future-self empathy exercises.
Pending editorial review.
Pending editorial review.
Interactive Mini Network
Click any neighbor to re-center the graph and follow the threads of connection.
Knowledge Graph Neighbors
Auto-linked to the rest of the Human Behavior Taxonomy by family, domain, dimension, and shared keywords.
Exploiting price differences between markets for risk-free profit.
The study of how real humans actually decide — bounded, social, emotional, and inconsistent.
With clear property rights and low transaction costs, parties negotiate to efficient outcomes.
Specialize in what you give up the least to do.
Complements raise each other's value; substitutes lower it.
Fixed costs don't scale with output; variable costs do.
Innovation destroys old industries and creates new ones.
Each additional unit produces less marginal benefit.
A long-run planner self in conflict with a short-run impulsive self.
Owning something raises its valuation — sellers want more to give it up than buyers will pay to acquire.
Bad money drives out good when both are legally equivalent.
The mythical fully rational, self-interested, utility-maximizing agent neoclassical models assume.
Where Intertemporal Choice is cited in the corpus
Essays, field guides, and diagnostics from The Incentives Lab that apply this element.
- EssayGoodhart's Law in the Real World
How measurable proxies capture judgment.
- EssayThe Perverse Incentives Hiding in Your KPIs
Cognitive shortcuts turned into scorecards.
- EssayAI Agents Inherit Your Incentives
How this element propagates into automated systems.
- ReferenceThe Periodic Table of Human Behavior
The full 1,267-element map this page belongs to.
- CourseIncentives 101
The free ten-part primer on reading a payoff structure.
Questions about Intertemporal Choice
- What is Intertemporal Choice?
- Intertemporal Choice is decisions involve trade-offs between costs and benefits at different times. It sits in the Cognition dimension (COG) of the Human Behavior Taxonomy™ as element HBT-COG-0411, within the Economics family. The core principle: decisions involve trade-offs between costs and benefits at different times. In incentive terms, it matters because it changes the payoff people perceive before they choose — which means it can be designed for, or exploited.
- What is an example of Intertemporal Choice?
- Capital allocation is intertemporal choice at scale. The Incentives Lab catalogs everyday, organizational, and historical instances of this element on its Human Behavior Taxonomy™ page (HBT-COG-0411).
- How is Intertemporal Choice exploited?
- Capital allocation is intertemporal choice at scale.
- How do you design around Intertemporal Choice?
- Use explicit discount rates and future-self empathy exercises.
- Which behavioral dimension does Intertemporal Choice belong to?
- Intertemporal Choice is classified in the Cognition dimension (COG) of the Human Behavior Taxonomy™, family "Economics", class "Mental Model". Its permanent identifier is HBT-COG-0411 and its evidence grade is B.