I'm not sure hyperbolic discounting is all that irrational.
Example from Wikipedia illustrating hyperbolic discounting: "For instance: "Would you prefer a dollar today or three dollars tomorrow?" or "Would you prefer a dollar in one year or three dollars in one year and one day?" For certain range of offerings, a significant fraction of subjects will take the lesser amount today, but will gladly wait one extra day in a year in order to receive the higher amount instead."
To me, the biggest risk is the counterparty risk that you'll never see the other person again. I myself would take $1 today from someone I've never met over $3 tomorrow, because I'm quite skeptical they'd even show up. Of course, the chance a person shows back up 365 vs. 366 days from now is pretty much identical, so I'd take the $3.
I agree with your thoughts on hyperbolic discounting.
Maybe I'll be dead next year. Maybe I just don't trust you.
Probabilistic reasoning is a tricky business. Also, I can reason about the likelihood that the store is going to have a loaf of bread tomorrow because we have experience dealing with that every day. The kind of scenarios concocted by economists are quite odd. Rarely is a stranger just giving you money with no strings attached.
Example from Wikipedia illustrating hyperbolic discounting: "For instance: "Would you prefer a dollar today or three dollars tomorrow?" or "Would you prefer a dollar in one year or three dollars in one year and one day?" For certain range of offerings, a significant fraction of subjects will take the lesser amount today, but will gladly wait one extra day in a year in order to receive the higher amount instead."
To me, the biggest risk is the counterparty risk that you'll never see the other person again. I myself would take $1 today from someone I've never met over $3 tomorrow, because I'm quite skeptical they'd even show up. Of course, the chance a person shows back up 365 vs. 366 days from now is pretty much identical, so I'd take the $3.