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Declining discount rates: Economic justifications and implications for long-run policy

Gollier, C., Koundouri, P, Pantelidis, Theologos (2008) Declining discount rates: Economic justifications and implications for long-run policy. Economic Policy, 23 (56). pp. 757-795. ISSN 0266-4658. E-ISSN 1468-0327. (doi:10.1111/j.1468-0327.2008.00211.x) (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)

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. (Contact us about this Publication)
Official URL
http:/dx.doi.org/10.1111/j.1468-0327.2008.00211.x

Abstract

Should economic policy target immediate problems like malaria and AIDS? Or should it target climate change, which may have even more dramatic life-threatening effects in the very long term? We discuss how the pattern of discount rates over the planning horizon bears on this important issue. A declining pattern of discount rates is theoretically justified by uncertainty about future economic conditions, and its shape and relevance can be estimated from historical data. We analyse empirically long-term interest rate data from nine countries, construct a weighted average representing a possible global discount rate pattern for a very long range of future dates, and assess its implications for the valuation of carbon mitigation policies.

Item Type: Article
DOI/Identification number: 10.1111/j.1468-0327.2008.00211.x
Uncontrolled keywords: conference proceeding; discount rate; economic policy; interest rate; theoretical study
Subjects: H Social Sciences
Divisions: Faculties > Social Sciences > Kent Business School > Accounting and Finance
Depositing User: Tracey Pemble
Date Deposited: 01 Aug 2016 10:44 UTC
Last Modified: 29 May 2019 17:40 UTC
Resource URI: https://kar.kent.ac.uk/id/eprint/56706 (The current URI for this page, for reference purposes)
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