Consumer choices with variations in item price, delay, and opportunity cost.

Tversky and Kahneman (1981) told participants to imagine they were at a store about to purchase an item. They were asked if they would be willing to drive 20 min to another store to receive a $5 discount on the item's price. Most participants were willing, but only when the original price of the item was small ($15); when the original price was relatively large ($125), most said they would not drive 20 min for a $5 discount. We examined this framing effect in 296 participants, but instead used a psychophysical‐adjustment procedure to obtain quantitative estimates of the discount required with different (a) item prices, (b) delays until the item's receipt, and (c) opportunity costs (in "driving" vs. "delivery" tasks). We systematically replicated Tversky and Kahneman's results, but also extended them by showing a substantial influence of opportunity costs on the consumer discounts required. A behavioral model of delay discounting—additive‐utility theory—accounted for 97% of the variance in these consumer discounts. [ABSTRACT FROM AUTHOR]