Final answer:
The false premise that a negative living reward can always be expressed using a discount factor less than 1 is contradicted by concepts like the negative income effect and loss aversion, which illustrate that rewards and costs can have complex, non-linear relationships.
Step-by-step explanation:
The statement suggests that any negative living reward can be represented by a discount factor less than 1, implying a reduction in value over time. However, this is not always the case, as negative living rewards can also be fixed or change non-linearly. They could represent fixed costs or even ones that escalate over time in ways that aren't directly related to a constant discount rate. For instance, a negative income effect, such as receiving less income than normal because a check didn't arrive, doesn't conform to a consistent discount model.
Similarly, the concept of loss aversion, as explained by behavioral economists like Daniel Kahneman and Amos Tversky, indicates that people's perceptions of gains and losses are not always linear or rational, hence not always representable by a simple discount factor. They suggest that emotions and cognitive biases can alter the perception of reward value. Consequently, a negative living reward's expression might require a more complex model than just a discount rate less than one to accurately represent its nature.