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Present Bias

Present bias is the observation that people place a lot of weight on the immediate moment but less attention to the future longer term consequences of individual behaviours and decisions.

Present bias is used to describe our desire for immediate gratification whilst perhaps overlooking the future impacts. People may not save enough for their retirement.

Environmental related behaviours in the immediate moment can have damaging long-term consequences for the sustainability of economic growth.

Present bias is linked to hyperbolic discounting. People discount future benefits or consequences very heavily.

As an example of present bias, a present-biased person might prefer to receive £100 today over receiving £115 tomorrow, but wouldn’t mind waiting an extra day if the choice were for the same amounts one year from today versus one year and one day from today.

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