Present bias, or hyperbolic discounting, is the tendency to overvalue immediate rewards, which can lead to choices that undermine long-term goals. A key manifestation of this bias is time-inconsistent behavior, where an individual fails to execute a previously established plan due to a lack of willpower at the moment of action. For instance, a household might plan to save after learning of a future income decline, but ultimately fail to do so, prioritizing current consumption levels. This failure to save stems from an internal self-control problem, which is distinct from the inability to borrow, an issue typically caused by external credit constraints.