You can set options at 3 levels of scope: public, user, and temporary.
Temporary options take precedence over user and public settings. User-level options take precedence over public settings. If you set a user level option for the current user, the corresponding temporary option is set as well.
Some options (such as COMMIT behavior) are database-wide in scope. Setting these options requires DBA authority. Other options (such as isolation_level) can also be applied to just the current connection, and need no special permissions.
Changes to option settings take place at different times, depending on the option. Changing a global option such as recovery_time takes place the next time the database is started.
Generally, only options that affect the current connection take place immediately. You can change option settings in the middle of a transaction, for example. One exception to this is that changing options when a cursor is open can lead to unreliable results. For example, changing date_format may not change the format for the next row when a cursor is opened. Depending on the way the cursor is being retrieved, it may take several rows before the change works its way to the user.
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