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Social time preference

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Author Info
Pasquale Scaramozzino () (Centre for Financial and Management Studies, SOAS, University of London, Thornhaugh Street, London WC1H 0XG, UK.)
Giancarlo Marini () (Dipartimento di Economia e Istituzioni, UniversitÁ di Roma «Tor Vergata», via di Tor Vergata s.n.c., 00133 Roma, Italy.)

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Abstract

The observed practice of discounting the future should not be rationalised on the grounds of myopia or selfishness. A positive rate of pure time preference is necessary to ensure that heterogeneous generations are treated in an egalitarian fashion. A zero social discount rate would yield intertemporal allocations which are biased against the current generations. Endogenous productivity growth requires that the social discount rate be set above the subjective rate of pure time preference. Positive social time preference, far from discriminating against future generations, is essential for a fairer intertemporal allocation of resources.

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Publisher Info
Article provided by Springer in its journal Journal of Population Economics.

Volume (Year): 13 (2000)
Issue (Month): 4 ()
Pages: 639-645
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Handle: RePEc:spr:jopoec:v:13:y:2000:i:4:p:639-645

Note: Received: 3 July 1999/Accepted: 6 October 1999
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Related research
Keywords: Social discount rate; overlapping generations;

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Barbara Annicchiarico & Nicola Giammarioli, 2004. "Fiscal rules and sustainability of public finances in an endogenous growth model," Working Paper Series 381, European Central Bank. [Downloadable!]
  2. John Creedy & Ross Guest, 2007. "Discounting and the Time Preference Rate: An Introduction," Department of Economics - Working Papers Series 993, The University of Melbourne. [Downloadable!]
  3. Dirk Willenbockel, 2008. "Social time preference revisited," Journal of Population Economics, Springer, vol. 21(3), pages 609-622, July. [Downloadable!] (restricted)
  4. John Creedy, 2006. "Evaluating Policy: Welfare Weights And Value Judgements," Department of Economics - Working Papers Series 971, The University of Melbourne. [Downloadable!]
  5. Giancarlo Marini & Pasquale Scaramozzino, 2008. "Social time preference: a rejoinder," Journal of Population Economics, Springer, vol. 21(3), pages 623-625, July. [Downloadable!] (restricted)
  6. Jan Schumacher & Wolfgang Buchholz, 2008. "Discounting and Welfare Analysis Over Time: Choosing the ç," CESifo Working Paper Series CESifo Working Paper No. , CESifo Group Munich. [Downloadable!]
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