We propose the anticipation-event-recall (AER) model. Set in a continuous time frame, the AER model formally links the three components of total utility (i.e., utility from anticipation, event utility, and utility from recall). The AER model predicts the temporal profiles of instant utility experienced before, during, and after a given event. Total utility is calculated as the integral of instant utility. The model builds on the psychological elements of conceptual consumption, adaptation, and time distance. By virtue of its rich formulation, the AER model produces a wide set of insights and testable predictions, including the U shape of instant utility during anticipation and the optimal duration of anticipation for a given event. Using both real and hypothetical events, we provide empirical evidence in support of the main implications of the AER model.
Data and supplemental material are available online.