Climate policies deserve a negative discount rate
We defend a methodology of discounting, for the evaluation of the long-term effects of climate policies, which relies on a social welfare objective, against the view that the market rate of return should be used for that purpose. We also show that in the long run, the discount rate for such policies should focus on the worst-case scenario for the most disadvantaged populations. As a consequence, it is likely that the appropriate discount rate for climate policies should be negative, implying a high priority for the future.
|Date of creation:||10 Jul 2012|
|Note:||View the original document on HAL open archive server: https://halshs.archives-ouvertes.fr/halshs-00728193|
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- Marc Fleurbaey, 2010.
"Assessing Risky Social Situations,"
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- Schelling, Thomas C, 1995. "Intergenerational discounting," Energy Policy, Elsevier, vol. 23(4-5), pages 395-401. Full references (including those not matched with items on IDEAS)
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