P SY CH OL OG I C AL S CIE N CE

Research Article

Discounting of Monetary and

Directly Consumable Rewards
Sara J. Estle, Leonard Green, Joel Myerson, and Daniel D. Holt
Washington University

ABSTRACTWe

compared temporal and probability discounting of a nonconsumable reward (money) and three
directly consumable rewards (candy, soda, and beer).
When rewards were delayed, monetary rewards were
discounted less steeply than directly consumable rewards,
all three of which were discounted at equivalent rates.
When rewards were probabilistic, however, there was no
difference between the discounting of monetary and
directly consumable rewards. It has been reported that
substance abusers discount delayed drug rewards more
steeply than delayed money, but this difference may reflect
special characteristics of drugs or drug abusers, or it may
reflect a general property of consumable rewards. The
present findings suggest that abused substances (like beer)
share the properties of other directly consumable rewards,
whereas delayed monetary rewards are special because
they are fungible, generalized (conditioned) reinforcers.
Discounting plays an important role in decision making, especially in situations that involve self-control, such as when drug
abuse, gambling, and other impulsive behaviors are involved.
Temporal discounting refers to the decrease in the subjective
value of an outcome as the delay until its occurrence increases.
Studies have shown that drug abusers discount delayed rewards
more steeply than nonabusers do. Moreover, using hypothetical
delayed rewards, researchers have shown that drug abusers
discount their drug of abuse more steeply than they discount
money (for a review, see Bickel & Marsh, 2001). This finding
could reflect either special characteristics of drugs or drug
abusers or a general property of consumable rewards (Odum &
Rainaud, 2003). That is, it is possible that there is some special
characteristic of abused substances or that there is some special
characteristic of drug abusers that selectively affects their

Sara Estle and Daniel Holt are now at the University of WisconsinEau Claire. Address correspondence to Leonard Green, Department
of Psychology, Campus Box 1125, Washington University, St. Louis,
MO 63130, e-mail: lgreen@wustl.edu.

58

choices involving drugs and leads to steeper discounting. Alternatively, delayed consumable rewards in general may be
evaluated differently than delayed monetary rewards, which are
exchangeable for consumable rewards, but are not themselves
directly consumable.
Odum and Rainaud (2003) recently argued that directly
consumable, primary reinforcers show steeper temporal discounting than conditioned reinforcers such as money. Participants in their study, screened for drinking, gambling, and eating
problems, made choices between immediate and delayed
amounts of the same commodity, either money or their favorite
food or alcoholic beverage. Examination of participants temporal-discounting functions revealed that delayed food rewards
and delayed alcohol rewards were discounted equivalently, but
both were discounted significantly more steeply than delayed
monetary rewards.
The present study examined whether there are differences
between the discounting of probabilistic consumable and
monetary rewards similar to the differences in discounting observed with delayed rewards. Previous research has shown that
in probability discounting, the subjective value of a monetary
reward decreases as the odds against its receipt increase (e.g.,
Rachlin, Raineri, & Cross, 1991), and that the discounting of
both delayed and probabilistic rewards is well described by a
hyperboloid function of the form
Y A=1 bXs ;

where Y represents the subjective value of a reward of amount A,

the parameter b governs the rate of discounting, X is delay until
or the odds against receipt of the reward, and the exponent s
reflects the scaling of amount and either delay or odds (Green &
Myerson, 2004; Myerson & Green, 1995). When s equals 1.0,
Equation 1 reduces to a simple hyperbola (Mazur, 1987).
Although hyperboloid discounting functions describe choice
involving both probabilistic and delayed outcomes (for a review,
see Green & Myerson, 2004), temporal and probability discounting are affected by the amount of reward in opposite ways:
Larger delayed rewards are discounted less steeply than smaller
delayed rewards, whereas smaller probabilistic rewards are

Copyright r 2007 Association for Psychological Science

Volume 18Number 1

S.J. Estle et al.

discounted less steeply than larger probabilistic rewards

(Du, Green, & Myerson, 2002; Green, Myerson, & Ostaszewski,
1999; Myerson, Green, Hanson, Holt, & Estle, 2003). The
similarity in the form of temporal- and probability-discounting
functions suggests that there may be similarities in the underlying decision-making processes, but the fact that the effects are
of opposite magnitude suggests that there are important differences as well.
The present study is the first to compare temporal and probability discounting of an abused substance (alcohol) with discounting of nonabused but immediately consumable goods (soda
and candy). It is also the first to examine probability discounting
of consumable rewards, as well as the first to compare the effects
of amount on the discounting of monetary rewards and immediately consumable rewards. At issue is whether steeper discounting of consumable than monetary rewards is observed with
probabilistic outcomes, as it is with delayed outcomes, and
whether immediately consumable rewards show magnitude effects similar to those observed with monetary rewards.
METHOD

Forty-seven Washington University undergraduates (23 males)

were recruited through the Department of Psychologys Human
Subjects Pool and received course credit for their participation.
Participants were tested individually in a small room containing
a computer with a touch-screen monitor (MicroTouch 3M). They
were informed that the purpose of the study was to examine their
preferences for hypothetical amounts of money, candy, soda, and
beer rewards and then were administered temporal- and probability-discounting tasks. For each participant, the order in
which the types of reward were presented was determined randomly. Within each reward type, which task (temporal or probability discounting) came first was randomly determined, and
within each task, which reward amount (large or small) came
first also was randomly determined. Finally, within each amount
condition of a task, the order in which the delays or probabilities
were presented was randomly determined.
Participants were told that on each trial, two amounts of a
hypothetical reward (money, beer, candy, or soda) would appear
on the screen. For the temporal-discounting task, they were
instructed that one amount could be received right now, whereas
the other amount could be received after some specified period
of time. For the probability-discounting task, they were instructed that one amount could be received for sure, whereas the
other amount could be received with some specified probability.
Participants also were instructed that the amount of the immediate or certain reward would change after each of their choices,
but that the amount of the delayed or probabilistic reward would
remain the same for a group of choices. Participants were informed that there were no correct or incorrect choices, and that
they were to indicate their choice by touching the option they
preferred. Following six practice trials, participants had the

Volume 18Number 1

opportunity to ask questions, and then the experiment began.

For each type of reward, two amounts were studied: 40 units and
100 units. For money, the units were dollars; for candy, the units
were bars; for beer and soda, the units were cans.1
For each delayed amount in the temporal-discounting task,
participants made six choices at each of five delays: 1 week, 1
month, 6 months, 1 year, and 3 years. Within each group of six
choices, the amount of the immediate reward was adjusted using
a staircase procedure that converged rapidly on the amount of
immediate reward equal in subjective value to the delayed reward (for a detailed description of this procedure, see Du et al.,
2002).
For each probabilistic amount in the probability-discounting
task, participants made six choices at each of five probabilities:
95%, 90%, 50%, 25%, and 10% chance. Within each group of
six choices, the amount of the certain reward was adjusted using
a staircase procedure that converged rapidly on the amount of
certain reward equal in subjective value to the probabilistic
reward.
For both temporal and probability discounting, we assessed
the degree of discounting by plotting the subjective value of
each delayed or probabilistic reward at each amount as a
function of the delay until receiving the reward or the probability
of receiving the reward. Equation 1 was then fit to the data for
each reward type and amount to determine the parameters of the
best-fitting temporal- and probability-discounting functions.
For purposes of statistical analysis, the area under the subjective values provided a measure of how steeply the reward was
discounted. Area measures, normalized based on the maximum
possible subjective values and the maximum delay or odds
studied, can range between 0.0 and 1.0, with smaller areas indicating steeper discounting (Myerson, Green, & Warusawitharana, 2001). Significance levels for statistical analyses
were set at a 5 .05.
RESULTS

The temporal- and probability-discounting data are presented in

Figure 1. In all four panels, the curves represent Equation 1, fit
to the group median data using a nonlinear, least squares algorithm.
For the temporal-discounting data (left panels of Fig. 1), this
equation accounted for more than 85% of the variance for both
1
It might be argued that the delay to receipt of some amount of a directly
consumable good underestimates the delay to reinforcement. Consider, for
example, the reward of 40 candy bars, used in the present experiment. One
would be unlikely to consume them all immediately. A similar argument might
be made with respect to money, however, in that many goods purchased with
money (e.g., two compact discs that might be purchased for $40) also would be
consumed over an extended period of time. Thus, the delay to receipt of some
amount of money also may underestimate the delay to reinforcement. Although
the issue of extended consumption is an important one, and one that has not
received sufficient attention from researchers (but see Raineri & Rachlin,
1993), monetary and directly consumable rewards are not qualitatively different
in this regard.

59

Discounting of Rewards

Fig. 1. Subjective value of the delayed (left panels) and probabilistic (right panels) rewards. Group median
subjective value, calculated as a proportion of the amount of reward (40 or 100 units), is plotted as a function
of the time until receipt of the delayed reward and as a function of the odds against receipt of the probabilistic
reward. Results for smaller amounts of reward are shown in the upper panels; results for larger amounts are
shown in the lower panels. The curved lines represent the hyperboloid discounting function (Equation 1) fit to
the data for each type of reward (money, beer, candy, and soda).

the small and larger amounts of money, beer, candy, and soda.
When Equation 1 was fit to the data from each participant, the
median R2 was greater than 79% for each amount and type of
reward.
Area measures of temporal discounting were calculated for
each participant and entered into a 4 (type of reward: money,
beer, candy, or soda)
2 (amount of reward: 40 or 100 units)
repeated measures analysis of variance (ANOVA). The ANOVA
revealed a significant effect of type of reward, F(3, 138) 5
16.61, Zp 2 5 .265, p < .001, reflecting the fact that money was
discounted less steeply than beer, candy, and soda, and
a significant effect of amount of reward, F(1, 46) 5 11.58,
Zp 2 5 .201, prep > .97, reflecting the fact that smaller reward
amounts were discounted more steeply than corresponding
larger amounts (see Table 1). There was no significant type-byamount interaction, F(3, 138) 5 1.961, p > .10. A follow-up
ANOVA testing for differences among the three directly con-

60

sumable rewards revealed no effect of type, F(2, 92) 5 2.03,

p > .10; a marginally significant effect of amount, F(1, 46) 5
3.588, prep 5 .86; and no interaction, F(2, 92) < 1.
For the probability-discounting data, Equation 1 accounted
for more than 98% of the variance for both the small and the
larger amounts of money, beer, candy, and soda. The results at
the individual level also were well described by Equation 1; for
each of the amounts and types of reward, the median R2 was
greater than 93%. Again, area measures were calculated for
each participant for both amounts at each of the four reward
types (money, beer, candy, and soda) and entered into a 4 (type)

2 (amount) repeated measures ANOVA. In contrast to the
results for delayed rewards, there was no effect of the type of
reward, F(3, 138) 5 2.168, p > .09. As with the delayed rewards, there was a significant magnitude effect, F(1, 46) 5
16.02, prep > .99, Zp 2 5 .258. As Table 1 shows, however, this
effect was opposite in direction to the magnitude effect observed

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S.J. Estle et al.

TABLE 1
Mean Area Under the Subjective Values of Delayed and
Probabilistic Rewards
Delayed amount

Probabilistic amount

Reward

Small

Large

Small

Large

Money

.547
(.038)
.361
(.033)
.412
(.039)
.409
(.038)

.640
(.036)
.387
(.036)
.450
(.042)
.433
(.039)

.332
(.021)
.328
(.028)
.376
(.032)
.357
(.030)

.286
(.019)
.290
(.031)
.357
(.035)
.309
(.031)

Beer
Candy
Soda

Note. Standard errors are given in parentheses.

with delayed rewards: The smaller probabilistic amounts were

discounted less steeply than the larger probabilistic amounts.
In addition to providing a measure of the probability with
which ANOVA outcomes will be replicated, the prep statistic
(Killeen, 2005a, 2005b) provides the basis for an alternative
approach to assessing the robustness of specific patterns of results involving multiple comparisons. That is, rather than assessing the probability with which one can replicate the finding
that the differences among multiple conditions are not all equal,
one can use prep to assess the probability that they will not be
equal in a specific way. As Killeen (2005a) indicated, if one
assumes independence, then the probability that a specific
pattern of differences will be replicated (i.e., all effects will have
the same signs as in the original experiment) is equal to the
product of the probabilities of replicating each of the differences
that make up that pattern.
In the present case, we first examined whether the pattern
observed when delayed monetary rewards were compared with
other rewards would be highly replicable (i.e., whether candy,
soda, and beer would each show steeper temporal discounting
than monetary rewards, both when the amounts involved were
small and when they were large). The probability of replicating
this pattern is given by the product of the prep values for the six
directional t tests in which the discounting of small and large
amounts of delayed monetary reward was compared with the
discounting of the corresponding amounts of each of the directly
consumable rewards. The present data indicated that the
probability of replicating this pattern is very high (prep 5 .977),
and thus this study provides strong evidence that delayed
monetary rewards are discounted less steeply than delayed
directly consumable rewards.
We also examined whether or not the pattern of differences
observed in the temporal discounting of the three directly consumable rewards (see Table 1) would be likely to be replicated,
as inferred from the product of the prep values for the six directional t tests (i.e., beer vs. candy, beer vs. soda, and soda vs.
candy, compared at small and large amounts). Inspection of

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these data reveals very small differences between the different

commodities and little interpretable pattern. Consistent with
this observation, the probability of replicating the pattern of
observed differences among the consumable commodities was
relatively low, prep 5 .170, suggesting that these differences are
unreliable.
The patterns of differences observed with probabilistic rewards also were relatively unreliable. The six directional t tests
in which the discounting of small and large amounts of probabilistic monetary reward was compared with the discounting of
the corresponding amounts of each of the directly consumable
rewards yielded a prep of .131 for the observed pattern, and the
six tests comparing the discounting of directly consumable
probabilistic rewards yielded a prep of .249.

DISCUSSION

Delayed monetary rewards were discounted less steeply than

delayed directly consumable rewards (beer, candy, and soda), all
of which were discounted at equivalent rates. This pattern was
observed for both smaller and larger amounts of delayed reward.
When rewards were probabilistic, however, there was no difference between the discounting of monetary and directly consumable rewards. In addition, steeper discounting of smaller
rewards than larger rewards was observed when rewards were
delayed, whereas steeper discounting of larger rewards than
smaller rewards was observed when rewards were probabilistic.
The observed pattern of opposite magnitude effects for temporal and probability discounting is well established for monetary rewards (for a review, see Green & Myerson, 2004).
Nonmonetary rewards have received much less attention in the
literature. Although two studies have reported a tendency toward steeper discounting of smaller than larger delayed nonmonetary rewards (Petry, 2001; Raineri & Rachlin, 1993), the
present study is the first to show significant magnitude effects
with directly consumable delayed rewards. The present study is
also the first to demonstrate that, like probabilistic monetary
rewards, probabilistic nonmonetary rewards show magnitude
effects in which larger amounts are discounted significantly
more steeply than smaller amounts.
Is there something special about abused substances or substance abusers that leads to steeper temporal discounting of
abused substances than monetary rewards, or, as Odum and
Rainaud (2003) suggested, are all directly consumable rewards
discounted more steeply than money? The present results provide no evidence that abused substances are special, at least for
individuals who are not substance abusers. Delayed candy, soda,
and beer rewards were all discounted at equivalent rates, as
were probabilistic candy, soda, and beer rewards. Interestingly,
it is delayed monetary rewards, rather than abused substances,
that may turn out to be special. Delayed monetary rewards were
discounted less steeply than the directly consumable rewards,

61

Discounting of Rewards

but when rewards were probabilistic, all were discounted at

equivalent rates regardless of type.
This finding raises the question of why, if monetary rewards
are special with respect to the degree of temporal discounting,
they are not special with respect to probability discounting.
There are, in fact, other differences between temporal and
probability discounting of monetary rewards. Most notable are
the opposite effects that amount of reward has on the degree of
temporal and probability discounting, but it also has been shown
that temporal discounting is sensitive to rates of inflation,
whereas probability discounting is not (Ostaszewski, Green, &
Myerson, 1998), and that the degrees of temporal and probability discounting vary independently across cultures (Du et al.,
2002). No overarching account of these differential effects has
been proposed, but they all suggest that temporal and probability discounting do not involve the same decision-making
processes despite the similar mathematical forms of the discounting functions (Green & Myerson, 2004). Nevertheless, the
apparently special status of delayed monetary rewards seems to
call for its own explanation.
The explanation cannot simply be that money is a conditioned
reinforcer whereas directly consumable rewards are primary
reinforcers, as Odum and Rainaud (2003) suggested. If moneys
status as a conditioned reinforcer were what makes it special,
then one would expect money to be discounted differently
than directly consumable rewards when monetary rewards are
probabilistic, as well as when they are delayed.
A related possibility, and one that provides a better account, is
that when it comes to temporal discounting, money is special
because it is fungible (in economic terms). That is, money is a
generalized (conditioned) reinforcer (in psychological terms),
exchangeable for other primary and secondary reinforcers
(Catania, 1998; Skinner, 1953). Therefore, people may discount
a delayed monetary reward less steeply than a specific, nongeneralized reward because, unlike specific rewards, money
retains its utility, despite the inconstancy of desire. When a
delayed monetary reward is received, it may be exchanged for
whatever is currently needed or desired. In contrast, the utility of
a specific, nongeneralized reward may fluctuate. Of course, its
utility may fluctuate either up or down. People are risk averse,
however, and thus are likely to consider such a commodity to be
worth less than one (i.e., money) whose utility does not fluctuate,
even when both have the same mean utility.
The present results are consistent with those of Odum and
Rainaud (2003) in demonstrating that alcohol rewards are not
special with respect to the rate at which they are discounted, at
least for individuals who are not substance abusers. It remains
possible, of course, that other abused substances could be discounted differently than other directly consumable rewards, or
that substance abusers might discount their substances of abuse
differently than other directly consumable rewards. Substance
abusers are known both to discount delayed monetary rewards
more steeply than do nonabusers and to discount abused

62

substances more steeply than they do money (e.g., Bickel,

Odum, & Madden, 1999; Coffey, Gudleski, Saladin, & Brady,
2003; Madden, Petry, Badger, & Bickel, 1997; Petry, 2001). To
date, however, no studies have compared the rates at which
substance abusers discount probabilistic or delayed abused
substances with the rates at which they discount other directly
consumable rewards. The present findings demonstrate the need
for such studies, the results from which will help explicate the
relative contributions of the special characteristics of substance
abusers and the special characteristics of abused substances as
reinforcers, as well as the interactions between these characteristics, to addictive behaviors. Understanding these contributions may shed new light on the causes of substance abuse,
thereby leading to more effective prevention and treatment.
AcknowledgmentsThis research was supported by National
Institutes of Health Grant MH 55308. We thank Tessa Mazzocco
for her assistance in conducting this study, Karen Norberg for
reminding us of the inconstancy of desire, and Peter Killeen,
who (as could have been predicted) was (once again) most helpful in providing us with stimulating suggestions and helpful feedback on our analyses.
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(RECEIVED 10/18/05; REVISION ACCEPTED 6/22/06;

FINAL MATERIALS RECEIVED 6/30/06)

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