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Valuing the Future

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Author Info
David Pearce
Ben Groom
Cameron Hepburn
Phoebe Koundouri

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Abstract

One of the most controversial areas of economics is the practice of discounting: attaching a lower weight to future costs and benefits than present costs and benefits. Discounting appears to offend notions of sustainable development and the interests of future generations. Recent advances in the theory of discounting hold out strong hope that the ‘tyranny of discounting’ can be avoided through the use of time varying discount rates (TVDRs). This paper reviews the recent rationales for TVDRs and applies the results to issues such as nuclear power and global warming control.

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File URL: http://www.world-economics-journal.com/Contents/ArticleOverview.aspx?ID=141
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Publisher Info
Article provided by World Economics, Economic & Financial Publishing, PO Box 69, Henley-on-Thames, Oxfordshire, United Kingdom, RG9 1GB in its journal World Economics Journal.

Volume (Year): 4 (2003)
Issue (Month): 2 (April)
Pages: 121-141
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Handle: RePEc:wej:wldecn:141

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  1. Cameron Hepburn & Phoebe Koundouri & Ekaterini Panopoulou & Theologos Pantelidis, 2006. "Social Discounting Under Uncertainty: A cross-country comparison," The Institute for International Integration Studies Discussion Paper Series iiisdp177, IIIS. [Downloadable!]
    Other versions:
  2. Ekaterini Panopoulou & B. Groom & P. Koundouri & Theologos Pantelidis, 2005. "Declining Discount Rates: Evidence from the UK," Economics, Finance and Accounting Department Working Paper Series n1470105, Department of Economics, Finance and Accounting, National University of Ireland - Maynooth. [Downloadable!]
  3. Andriy Zapechelnyuk & Ro'i Zultan, 2008. "Job Market Signalling and Job Search," Levine's Bibliography 122247000000002301, UCLA Department of Economics. [Downloadable!]
    Other versions:
  4. Ekaterini Panopoulou & B. Groom & P. Koundouri & Theologos Pantelidis, 2005. "Discounting the distant future: How much does model selection affect the certainty equivalent rate?," Economics, Finance and Accounting Department Working Paper Series n1480105, Department of Economics, Finance and Accounting, National University of Ireland - Maynooth. [Downloadable!]
    Other versions:
  5. Frank Ackerman and Ian J. Finlayson, . "06-07 “The Economics of Inaction on Climate Change: A Sensitivity Analysis”," GDAE Working Papers 06-07, GDAE, Tufts University. [Downloadable!]
  6. Camilla Froyn, 2005. "Decision Criteria, Scientific Uncertainty, and the Globalwarming Controversy," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 10(2), pages 183-211, April. [Downloadable!] (restricted)
  7. Gunter Stephan & Georg Müller-Fürstenberger, 2006. "Discounting The Global Climate When Technological Change is Endogenous," Diskussionsschriften dp0603, Universitaet Bern, Departement Volkswirtschaft. [Downloadable!]
  8. Onno J. Kuik & Barbara Bucher & Michela Catenacci & Etem Karakaya & Richard S.J. Tol, 2006. "Methodological aspects of recent climate change damage cost studies," Working Papers FNU-122, Research unit Sustainability and Global Change, Hamburg University, revised Dec 2006. [Downloadable!]
  9. Alfred Endres & Regina Bertram & Bianca Rundshagen, 2007. "Environmental Liability Law and Induced Technical Change – The Role of Discounting," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 36(3), pages 341-366, March. [Downloadable!] (restricted)
  10. Cameron Hepburn, 2003. "Hyperbolic Discounting and Resource Collapse," Economics Series Working Papers 159, University of Oxford, Department of Economics. [Downloadable!]
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  11. Diwakara, H. & Chandrakanth, M.G., 2007. "Beating negative externality through groundwater recharge in India: resource economic analysis," Conference Papers 43614, University of Agricultural Sciences, Bangalore, Department of Agricultural Economics. [Downloadable!]
    Other versions:
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