Near bias effect

"We care less about future experiences than we do about near ones. "

Definition

The near-bias effect is defined by the tendency to be more concerned about what happens in the present than what will happen in the future. When given a choice, people are inclined to prefer immediate rewards to those available after a delay, implying that the value of delayed rewards relative to more immediate ones are discounted (i.e. are perceived to be worth less) [1]. For this reason, economists refer to this concept as temporal discounting. While economists popularized this concept, it has also been extensively studied in psychology, in individual and group settings, and it applies to several social phenomena such as drug addictions [2] and procrastination [3].

Example

Many studies have shown that by overvaluing benefits in the short-term we neglect our long-term well-being. People don’t save enough money for retirement, preferring to spend their money now rather than having it in their old age. People overeat in the present, despite the problems that obesity can cause in the future. We continue to think that we should eat moderately and skip dessert, but ‘just this once’ we will indulge ourselves. After all, eating one hamburger doesn’t damage one’s health much, and what little damage it does might well be outweighed by the pleasure it gives. The problem, of course, is that the situation is endlessly repeated, and ‘just this once’ becomes always.

Explanation

It is still unclear why the brain is biased towards the present. One explanation is that when making decisions, we favour immediate rewards as we associate uncertainty to long-term outcomes [4]. Part of the reason for this is that we have difficulty understanding long-term consequences. One leading hypothesis is that for our ancestors, the immediate challenge of survival took precedence over concerns or speculations about the distant future [5]. Thus, a temporal myopia, the inability to consider the long-term outcomes of an action when making a choice, would have developed and remains to this day as an evolutionary artefact.  This bias can also be explained by impulsivity and a tendency for immediate gratification as present rewards are weighted more heavily than future ones [6]. Consequently, the near-bias effect can make us blind to the benefits of long-term decision-making, which can sometimes include gains far greater than those of more immediate decisions [2].

Consequences

The near-bias effect can have negative implications for all sorts of institutions and professions and can be damaging in many aspects of our lives. Think of climate change: by now it is clear that the long-term effects of carbon intensive activities and technologies will be enormously costly. As abatement costs must be paid upfront while the benefits are likely to be delayed by several decades it is hard for people to get motivated to change their behaviours. Ignoring climate change in the short term has benefits both to individuals and to organizations as they do not have to make changes if they ignore the influence their carbon footprint has on the world. Even if we think we are going to have a terrible time in ten years, we just aren’t motivated to change. Acting on climate change represents a trade-off between short-term and long-term benefits, which is the hardest trade-off for people to make.

Thoughts on how to act in light of this bias

  • Thinking about the specific impacts of future events may have the advantage of engaging affective processing and counteracting the tendency to discount the future.

  • Break down big goals into small ones so the reward is no longer a far-off possibility but something that is more immediate and achievable.

  • Thinking about and discussing your long-term future on a regular basis helps you make decisions that prioritize it.

How is this bias measured?

Near-bias effect tasks generally require participants to make choices between a small variable reward available immediately versus a larger constant reward available after a variable delay. These binary comparisons are used to infer an indifference point which is the point at which the participant switched from preferring the immediate reward to the delayed reward [8]. For example, a participant may choose to wait 1 month for $100 over $50 now, but when given the choice between $60 now or $100 in 1 month, the participant may choose $60 now. This would indicate that $60 now is the indifference point. For each amount of money, the participant indicates whether they preferred the immediate or delayed reward. This procedure is repeated with different delays which allows researchers to compare indifference points and discounting rates. The near-bias effect is detected whenever the lesser immediate rewards are preferred over the more valuable long-term rewards.

This bias is discussed in the scientific literature:

This bias has social or individual repercussions:

This bias is empirically demonstrated:

References

[1] Story, Giles W., Ivo Vlaev, Ben Seymour, Ara Darzi & Raymond J. Dolan (2014). Does temporal discounting explain unhealthy behavior? A systematic review and reinforcement learning perspective. Frontiers in Behavioral Neuroscience, 8, 1–15. https://doi.org/10.3389/fnbeh.2014.00076. (Systematic review)


[2] Bickel, Warren K., Amy L. Odum & Gregory J. Madden (1999). Impulsivity and cigarette smoking: delay discounting in current, never, and ex-smokers. Psychopharmacology 146, 447–454. https://doi.org/10.1007/PL00005490


[3] Haiyan, Wu, Gui Danyang, Lin Wenzheng, Gu Ruolei, Zhu Xiangru & Liu Xun (2016). The procrastinators want it now: Behavioral and event-related potential evidence of the procrastination of intertemporal choices. Brain and Cognition 107:16-23. doi: 10.1016/j.bandc.2016.06.005


[4] Raihani, Nichola & David Aitken (2011). Uncertainty, rationality and cooperation in the context of climate change. Climatic Change, 108(1-2), 47–55. doi:10.1007/s10584-010-0014-4


[5] Cyrus, Chu C. Y., Hung-Ken Chien & Ronald D. Lee (2010). The evolutionary theory of time preferences and intergenerational transfers. Journal of Economic Behavior & Organization, 76(3), 451–464. https://doi.org/10.1016/j.jebo.2010.09.011


[6] Frederick, Shane, George Loewenstein & Ted O’Donoghue (2002). Time discounting and time preference: A critical review. Journal of Economic Literature, 40, 351-401.


[7] Basile, Alexandra G. & Maggie E. Toplak  (2015). Four converging measures of temporal discounting and their relationships with intelligence, executive functions, thinking dispositions, and behavioral outcomes. Frontiers in Psychology, 6, 6–18. https://doi.org/10.3389/fpsyg.2015.00728

Tags

Individual level, Availability heuristic, Need for security, Need for cognitive closure

Related biases

  • Temporal discounting (synonym) 

  • Present bias

  • Hyperbolic discounting

Author

Sophie-Andrée Vinet, Bsc. cognitive neuroscience, Université de Montréal.


How to cite this entry

Vinet, S.-A. (2020). Near-bias effect. In C. Gratton, E. Gagnon-St-Pierre, & E. Muszynski (Eds). Shortcuts: A handy guide to cognitive biases Vol. 1. Online: www.shortcogs.com

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