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Discounting Dollars, Discounting Lives: Intergenerational Distributive Justice and Efficiency

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  • Louis Kaplow

Abstract

The view that intergenerational distributive justice and efficiency should be treated separately is familiar, yet controversial. This article elaborates the often-implicit justifications for separate treatment and provides a more express statement of how and when such treatment is appropriate. Substantial attention is devoted to an approach that holds constant the intra- and intergenerational distribution of well-being, which proves to be a valuable analytical device even for intergenerational policies that are not distribution neutral. Also explored are possible interrelationships between intergenerational distributive justice and efficiency, the choice of interest rate for discounting dollars, and how the present approach relates to those that would employ direct social weights to dollars at different points in time.

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Bibliographic Info

Paper provided by National Bureau of Economic Research, Inc in its series NBER Working Papers with number 12239.

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Date of creation: May 2006
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Handle: RePEc:nbr:nberwo:12239

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Cited by:
  1. David Canning, 2011. "Progress in Health around the World," PGDA Working Papers 8011, Program on the Global Demography of Aging.
  2. Deborah Lucas & Marvin Phaup, 1975. "The Cost of Risk to the Government and Its Implications for Federal Budgeting," NBER Chapters, in: Measuring and Managing Federal Financial Risk, pages 29-54 National Bureau of Economic Research, Inc.

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