Abstract

http://ssrn.com/abstract=1273932
 
 

References (45)



 
 

Citations (3)



 


 



Declining Discount Rates: Economic Justifications and Implications for Long-Run Policy


Christian Gollier


University of Toulouse 1 - Industrial Economic Institute (IDEI); CESifo (Center for Economic Studies and Ifo Institute)

Phoebe Koundouri


Athens University of Economics and Business - Department of International and European Economic Studies; University of Reading - Department of Economics

Theologos Pantelidis


University of Macedonia - Department of Economics


Economic Policy, Vol. 23, Issue 56, pp. 757-795, October 2008

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.

Number of Pages in PDF File: 38

Accepted Paper Series


Date posted: October 2, 2008  

Suggested Citation

Gollier, Christian and Koundouri, Phoebe and Pantelidis, Theologos, Declining Discount Rates: Economic Justifications and Implications for Long-Run Policy. Economic Policy, Vol. 23, Issue 56, pp. 757-795, October 2008. Available at SSRN: http://ssrn.com/abstract=1273932 or http://dx.doi.org/10.1111/j.1468-0327.2008.00211.x

Contact Information

Christian Gollier (Contact Author)
University of Toulouse 1 - Industrial Economic Institute (IDEI) ( email )
Manufacture des Tabacs
21 Allee de Brienne bat. F
Toulouse Cedex, F-31000
France
+33 61 12 86 30 (Phone)
+33 61 12 86 37 (Fax)
CESifo (Center for Economic Studies and Ifo Institute)
Poschinger Str. 5
Munich, DE-81679
Germany
Phoebe Koundouri
Athens University of Economics and Business - Department of International and European Economic Studies ( email )
GR-10434 Athens
Greece
+0030 210 8203147 (Phone)
+0030 210 8214122 (Fax)
HOME PAGE: http://www.econ.ucl.ac.uk/downloads/koundouri/cv.pdf
University of Reading - Department of Economics ( email )
Reading, RG6 6AA
United Kingdom
+44 - (0)118 - 9875123 (Phone)
+44 - (0)118 - 9750236 (Fax)
HOME PAGE: http://www.rdg.ac.uk/economics/koundouri.html
Theologos Pantelidis
University of Macedonia - Department of Economics ( email )
Thessaloniki, 54006
Greece
Feedback to SSRN


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