Description
Return a supplied hyperbolic social-distance discount term.
Decision models distinguish monetary payoffs, probabilities, model values and subjective equivalents. Discounting, probability weighting and reference-dependent utility terms depend on supplied parameters and cannot by themselves establish actual preferences or an appropriate allocation.
Return a supplied hyperbolic social-distance discount term.
When to use this tool
Use Social Discount Recipient Distance Term when evaluating the stated decision-model, lottery or discount contribution.
How to use the tool and how it works
- Enter benefit, socialDistance, rate. Use the units and conventions below.
- Run the tool. Correct any format, range, or cross-field input error before interpreting the output.
- Read discountFactor, discountedBenefit. Use the output convention below.
Return a supplied hyperbolic social-distance discount term. Require socialDistance/rate >= 0; factor = 1/(1+rate*distance), discountedBenefit = benefit*factor.1
| Input field | Meaning and units | Accepted input |
|---|---|---|
| benefit | Benefit | Required. Finite number. |
| socialDistance | Social Distance | Required. Finite number; minimum 0. |
| rate | Rate | Required. Finite number; minimum 0. |
| Output field | Interpretation | Returned shape |
|---|---|---|
| discountFactor | Discount Factor | Required. Finite number. |
| discountedBenefit | Discounted Benefit | Required. Finite number. |
{
"input": {
"benefit": 100,
"socialDistance": 5,
"rate": 0.2
},
"output": {
"discountFactor": 0.5,
"discountedBenefit": 50
}
}Limitations and assumptions
- Distance scale and rate are supplied research conventions; no actual social preference or appropriate allocation is inferred.
- Inputs must satisfy both the field types and the cross-field conditions above. Invalid input causes an error; a successful false flag or documented placeholder is a different result.
- Numeric calculations use binary floating point unless exact decimal-integer arithmetic is explicitly stated. No hidden measurement tolerance or decimal rounding is added; nonfinite or out-of-contract results are rejected. Numeric signed-zero results are exported as zero.
Alternative or Complementary methods
Fit and validate an appropriate complete decision model against relevant observations; distinguish model scores from money and assess actual financial choices separately.
References
Similar or alternative tools
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