Fighting Yourself: Economic Analysis of Addiction and Self-Control

The first thought that comes to mind, when talking about self-control is that self-control has to be a depletable resource and has to completely disappear in a case of overusing it. However, in this paper a concept of willpower as a muscle is investigated and the concept of willpower becomes not so straightforward, as in some classic works. A consumer with multiple sources to use self-power tends to have bigger optimal willpower value, than the one with only one source. This occurs due to willpower working as a muscle in a long run and even though in a short run self-control is still depletable and consumer is influenced by hyperbolic discounting, optimal willpower increases. Also, a positive correlation between income and willpower is found, which leads to a conclusion: the wealthier the person is, the more self-control he is going to apply.