Temptation and self‐control for the impure benevolent planner: The case of heterogeneous discounting

Abstract

AbstractThis paper presents a “behavioral” model of a normative benevolent social planner, who faces a self‐control problem when he/she is in charge of aggregating diverse and conflicting preferences of individuals. The model is presented in the context of aggregating preferences over intertemporal streams of social outcomes, in which Zuber and Jackson and Yariv have shown the impossibility of a time‐consistent and Paretian social objective function. Unlike previous studies, our investigation focuses on the compatibility of the Pareto condition with the impure social planner who has a dynamically consistent self‐control utility function characterized by Gul and Pesendorfer. Assuming that the social planner is tempted to adopt the majority's opinion when there is a conflict of opinions among individuals, the paper characterizes an aggregation form in which the planner is allowed to depart from dictatorship in ex‐post choice under noncommitment.