I first saw the following clip from Mankiw's blog a few weeks back. Please watch it, and think of the following issues:
1. Is everyone playing the game rationally?
2. Does the talking before decision time matter?
3. What do you think will happen if the game is played repeatedly between these two people?
4. What would be your rational strategy, if you know you're playing this game with an irrational opponent?
I hope you will find a very close analogy of this clip to the time inconsistency issue.
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