An Internal Weakness in Current Intertemporal Preference Theory

This theoretical paper demonstrates that using utility functions to study intertemporal decisions creates an internal contradiction: nonfulfillment of comparability, which is a condition of constructing utility functions. It shows that Riemann’s rearrangement theorem leads to basket incomparability for infinitely lived agents in discrete time and considers Austrian theory the best replacement for the model that implies this conflict. It suggests also that cardinality cannot fix this problem, since it does not eliminate the likelihood of generating conditionally convergent series unable to represent the rankings of potential consumption streams.