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Social Discounting under Uncertainty: A cross-country Comparison

Hepburn, Cameron, Koundouri, Phoebe, Panopoulou, Ekaterini, Pantelidis, Theologos (2009) Social Discounting under Uncertainty: A cross-country Comparison. Journal of Environmental Economics and Management, 57 (2). pp. 140-150. ISSN 0095-0696. (doi:10.1016/j.jeem.2008.04.004) (The full text of this publication is not currently available from this repository. You may be able to access a copy if URLs are provided) (KAR id:34302)

The full text of this publication is not currently available from this repository. You may be able to access a copy if URLs are provided.
Official URL:
http://dx.doi.org/10.1016/j.jeem.2008.04.004

Abstract

Recent research suggests that social cost-benefit analysis should be conducted with a declining discount rate. For instance Newell and Pizer [Discounting the distant future: how much do uncertain rates increase valuations? J. Environ. Econ. Manage. 46 (2003) 52–71] show that the US certainty-equivalent discount rate declines through time, using a simple autoregressive model of US interest rates. This paper extends that line of research, estimating both autoregressive and regime-switching models of real interest rates to determine certainty-equivalent discount rates in Australia, Canada, Germany and the UK. It is found that the regime-switching model is a better model of past interest rate behavior for all four countries. This model tends to produce a more rapid decline in certainty-equivalent discount rates. The paper provides applications to the economics of climate change and nuclear power.

Item Type: Article
DOI/Identification number: 10.1016/j.jeem.2008.04.004
Uncontrolled keywords: Discounting, Uncertainty, Regime-switchingmodels, Climate change, Nuclearpower
Subjects: H Social Sciences
H Social Sciences > H Social Sciences (General)
Divisions: Divisions > Kent Business School - Division > Kent Business School (do not use)
Depositing User: Catherine Norman
Date Deposited: 17 Jun 2013 14:41 UTC
Last Modified: 05 Nov 2024 10:17 UTC
Resource URI: https://kar.kent.ac.uk/id/eprint/34302 (The current URI for this page, for reference purposes)

University of Kent Author Information

Panopoulou, Ekaterini.

Creator's ORCID: https://orcid.org/0000-0001-5080-9965
CReDIT Contributor Roles:

Pantelidis, Theologos.

Creator's ORCID:
CReDIT Contributor Roles:
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