In a rapidly changing external environment, individuals can still maintain the past, present, and future self-coherent state, which we called self-continuity (SC). Based on the time orientation, SC can be divided into past self-continuity (PSC), future self-continuity (FSC), and global self-continuity (GSC). Existing evidence shows that both PSC and FSC can actively predict various psychological and behavioral performance. However, enhancing SC does not always benefit economic behavior. The higher the future self-continuity, the more inclined people are to pursue future benefits and avoid future risks. The higher the past self-continuity, the more people prefer consumption goods related to the past self, but also the more susceptible to the sunk cost effect. Specific psychological processes need to be analyzed for the above differences in the influences of FSC and PSC on economic behaviors. However, most existing studies only focus on the predictive effects of either FSC or PSC on specific economic behaviors, and the discussion on the influencing mechanism is limited, so it cannot be fully explained. The main purpose of this paper is to construct an integrated theoretical model to comprehensively explain how SC influences different types of economic behavior.

(1) The life cycle hypothesis implicitly assumes FSC: to fully incorporate future expectations into decision making, the present self and future self must be completely continuous. This level of continuity occurs when people can most clearly perceive their future situation and fully integrate expected information into the current decision-making process, thereby maximizing the overall utility of resources throughout the life cycle. According to the life cycle hypothesis, when the present self is completely continuous with the future self, people’s economic behavior is likely to become completely rational. (2) A joint account model was proposed based on the behavioral life cycle hypothesis to explain how FSC influences spending adjustment willingness. Within the framework of the behavioral life cycle hypothesis, due to changes in FSC, the present and future income accounts can merge or separate, this affects the adjustment of the willingness to adjust spending. However, because the model focuses on the flow of money income accounts with different time labels, and consumer goods themselves do not generate money income, it cannot explain the effect of FSC on real goods preference. (3) Based on the double-entry mental accounting theory, researchers analyzed how PSC reduction alleviates the sunk cost effect via “psychological decoupling”. That is, the reduction of PSC will lead to the psychological decoupling of payment and consumption in the same “transaction” account. The happiness of consumption is not diluted by past payments, thus reducing the sunk cost effect. However, some manifestations of the effect of PSC on economic behavior do not involve such transactions. For example, the increase in PSC encourages people to prefer goods associated with their past selves, but this consumption preference does not occur because the transaction has not been completed, because the consumer has not invested in these consumer goods in the past. In this way, the psychological decoupling model seems to be only applicable to the analysis of economic behaviors that have already incurred transaction costs.

Based on a comparative analysis of existing hypotheses and models and relevant research evidence, we constructed a joint benefits account model (JBAM) to provide a more appropriate theoretical framework for future research. In the income sharing account model, SC will change horizontally due to individual attributes or situational factors. An increase in SC will promote a shift from separation to consolidation of present and future benefits accounts (affected by FSC), or present and past income accounts (affected by PSC). When benefits accounts are separated, individual economic behavior primarily serves the present and focuses on the immediate benefits of the current account. Accordingly, when the benefits accounts are merged, individuals pursue the comprehensive benefits of the current and past accounts. The combination or separation of benefits accounts directly affects individual economic behavior.

The construction of the JBAM may provide a new perspective on the mechanisms by which SC influences psychological and behavioral phenomena. First, few studies put FSC and PSC under the same framework to explain the psychological mechanism of such influence. This paper provides a referable theoretical model for researchers to continue to explore the comprehensive impact of different time orientations of SC on other psychological or behavioral phenomena. Second, the proposed model may be beneficial to the intervention study of sunk cost effect. The inclusion of SC in the reasoning of the mechanism of sunk cost effect is not the first in the revenue-sharing account model, but to our knowledge, no other studies have explained the sunk cost effect from the perspective of psychological account merger and separation. Given that many researchers have developed SC manipulation and promotion schemes, these schemes, combined with our path analysis on the sunk cost effect of SC, may provide references for corresponding intervention studies. To further enrich and develop the model, more targeted empirical studies need to be designed in the future to test and develop the overall model.