How Should Benefits and Costs Be Discounted in an Intergenerational Context? The Views of an Expert Panel

@inproceedings{Arrow2013HowSB,
  title={How Should Benefits and Costs Be Discounted in an Intergenerational Context? The Views of an Expert Panel},
  author={Kenneth J. Arrow and Maureen L. Cropper and Christian Gollier and Ben Groom and Geoffrey Heal and Richard G. Newell and William D. Nordhaus and Robert S. Pindyck and William A. Pizer and Paul R. Portney and Thomas Sterner and Richard S.J. Tol and Martin L. Weitzman},
  year={2013}
}
  • Kenneth J. Arrow, Maureen L. Cropper, +10 authors Martin L. Weitzman
  • Published 2013
  • DOI:10.2139/ssrn.2199511
Should governments, in discounting the future benefits and costs of public projects, use a discount rate that declines over time? The argument for a declining discount rate is a simple one: if the discount rates that will be applied in the future are persistent, and if the analyst can assign probabilities to these discount rates, this will result in a declining schedule of certainty-equivalent discount rates. A growing empirical literature estimates models of long-term interest rates and uses… CONTINUE READING

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