Problem 2 : Self-control problems and commitment devices on Thursday evening Consider the following setup : there are three periods t = 0, 1, 2. Think of them as Wednesday, Thursday and Friday. An individual has to decide whether to attend a party in t = 1 (Thursday). Going to the party has an immediate benefit v, but a delayed cost c. In addition, the party isn't always good : with probability p the party will be of low quality, generating benefit vL. With probability 1 ? p, it will be of high quality with benefit vH. It is only known on Thursday whether the party will good or bad. The utility from not attending the party is normalized to zero. The individuals have (?, ?)-preferences, and we consider four types of individuals : naifs, partial naifs (with ? > ? ? , as discussed in class), sophisticates and TCs. We make the following assumption regarding the parameters ? Assumption 1 : vL ?c. ? Assumption 2 : vL > ??c ? . ? Assumption 3 : vL

Problem 2 : Self-control problems and commitment devices on Thursday evening Consider the following setup : there are three periods )3 = 0,1,2. Think of them as Wednesday. Thursday and Friday. An individual has to decide whether to attend a party in i = 1 (Fl-nirsday). Going to the party has an immediate benet :1. but a delayed cost 9. In addition. the party isn't always good : with probability p the party will be of low quality. generating benet 111.. With probability 1 7 p. it will be of high quality with benet 111;. It is only known on Thursday whether the party will good or bad. The utility from not attending the party is normalized to zero. The individuals have (. 6)-preferences. and we consider four types of individuals : naifs. partial naifs [with E > 15'. as discussed in class). sophisticates and T05. We make the following assumption regarding the parameters - Assumption 1 : 11L 6:. o Assumption 2 : am > 36c. o Assumption 3 : 11L