Many economic models involve a trade-off between current and future rewards.
These models are all dynamic in the sense that an action at one stage influences the available actions or rewards at a future stage. Many such examples fall into the class of dynamic programming problems and for large classes of such problems, techniques for finding optima are well understood. Less well understood, however, are the decisions which individuals actually make in such dynamic settings. This is an empirical issue which lends itself to the methodology of laboratory investigation. The structure of the problem is motivated by the consumption vs. investment tradeoff of the one-sector growth problem.