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Unilateral Dominance and Social Discounting

Author

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  • Xiangyu Qu

    (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)

  • Bach Dong Xuan

    (UEL - University of Economics and Law [Vietnam National University, HCM] - VNU-HCM - Vietnam National University, Ho Chi Minh City / Đại học Quốc gia TP. Hồ Chí Minh)

Abstract

This paper addresses the intricate challenge of establishing social discount rates across far-reaching generations, particularly in the face of divergent social viewpoints. We propose a principle of future-improved unilateral dominance to characterize social discount rates. Despite its divergence from traditional principles, our principle prioritizes the welfare of distant generations, resonating with a minority concern within society. Our findings indicate that society adhering to this principle exhibit greater patience and future-oriented concern than any individual. TThis approach, contingent upon the preferences of current generations, offers theoretical pathways to enhance considerations for the welfare of the distant future in the context of long-term environmental projects or activities.

Suggested Citation

  • Xiangyu Qu & Bach Dong Xuan, 2024. "Unilateral Dominance and Social Discounting," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) hal-04487520, HAL.
    • Handle: RePEc:hal:cesptp:hal-04487520
    Note: View the original document on HAL open archive server: https://hal.science/hal-04487520
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    References listed on IDEAS

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    1. Stéphane Zuber, 2011. "The aggregation of preferences: can we ignore the past?," Theory and Decision, Springer, vol. 70(3), pages 367-384, March.
    2. Stephen A. Marglin, 1963. "The Social Rate of Discount and The Optimal Rate of Investment," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 77(1), pages 95-111.
    3. Millner, Antony & Heal, Geoffrey, 2018. "Time consistency and time invariance in collective intertemporal choice," Journal of Economic Theory, Elsevier, vol. 176(C), pages 158-169.
    4. Matthew O. Jackson & Leeat Yariv, 2015. "Collective Dynamic Choice: The Necessity of Time Inconsistency," American Economic Journal: Microeconomics, American Economic Association, vol. 7(4), pages 150-178, November.
    5. Weitzman, Martin L., 1998. "Why the Far-Distant Future Should Be Discounted at Its Lowest Possible Rate," Journal of Environmental Economics and Management, Elsevier, vol. 36(3), pages 201-208, November.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Social discounting; future-improved unilateral dominance; long-term environmental projects;
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