Present bias
Overweighting the immediate at the expense of the future, even against our own plans.
What it means
Present bias is the systematic tendency to give disproportionate weight to payoffs that are near to the present, so that immediate costs and rewards dominate future ones in a way that pure time discounting would not predict. In the quasi-hyperbolic (β–δ) model it is captured by the β term, an extra discount applied to everything that is not happening right now, which sits on top of the standard exponential discount. This extra pull toward the present is the engine behind procrastination, under-saving, broken resolutions, and impulsive consumption, because the small immediate cost of acting (or the small immediate pleasure of indulging) is overweighted relative to the larger but delayed payoff. A key feature is that it produces time inconsistency: a far-sighted plan made today is overturned when 'tomorrow' actually arrives and the tempting option moves into the present. People who are sophisticated about their own present bias seek commitment devices, while naive ones repeatedly plan to start later. It matters because it explains the gap between what people intend and what they do, and it justifies defaults, deadlines, and pre-commitment as tools.
Examples
Resolving to start the diet 'tomorrow' every single day, because today's cake is here and the health benefit is far off.
Nearly everyone means to join the pension 'next payday'. Automatic enrolment works because it removes the moment where this month's take-home pay competes with a reward forty years away.
The tax return takes two hours and sits untouched for six weeks: the two hours are due now, while the relief of having filed is always somewhere in the future.
First described in O'Donoghue & Rabin (1999).