Policymaking for Posterity

55 Pages Posted: 11 Sep 2008 Last revised: 12 Nov 2008

See all articles by Lawrence H. Summers

Lawrence H. Summers

Harvard University; National Bureau of Economic Research (NBER); Harvard University - Harvard Kennedy School (HKS)

Richard J. Zeckhauser

Harvard University - Harvard Kennedy School (HKS); National Bureau of Economic Research (NBER)

Multiple version iconThere are 2 versions of this paper

Date Written: September 10, 2008

Abstract

Policymaking for posterity involves current decisions with distant consequences. Contrary to conventional prescriptions, we conclude that the greater wealth of future generations may strengthen the case for preserving environmental amenities; lower discount rates should be applied to the far future, and special effort should be made to avoid actions that impose costs on future generations. Posterity brings great uncertainties. Even massive losses, such as human extinction, however, do not merit infinite negative utility. Given learning, greater uncertainties about damages could increase or decrease the optimal level of current mitigation activities. Policies for posterity should anticipate effects on: alternative investments, both public and private; the actions of other nations; and the behaviors of future generations. Such effects may surprise. This analysis blends traditional public finance and behavioral economics with a number of hypothetical choice problems.

Keywords: Business and Government Policy, International Economics, Microeconomics, Environment and Natural Resources, International Affairs/Globalization, Science┬┐ Technology and Public Policy

JEL Classification: D90, D64, Q54, D81

Suggested Citation

Summers, Lawrence H. and Zeckhauser, Richard J., Policymaking for Posterity (September 10, 2008). HKS Working Paper No. RWP08-040; Harvard Law School Program on Risk Regulation Research Paper No. 08-2. Available at SSRN: https://ssrn.com/abstract=1266220 or http://dx.doi.org/10.2139/ssrn.1266220

Lawrence H. Summers

Harvard University ( email )

1875 Cambridge Street
Cambridge, MA 02138
United States
617-495-1502 (Phone)
617-495-8550 (Fax)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

Harvard University - Harvard Kennedy School (HKS) ( email )

79 John F. Kennedy Street
Cambridge, MA 02138
United States

Richard J. Zeckhauser (Contact Author)

Harvard University - Harvard Kennedy School (HKS) ( email )

79 John F. Kennedy Street
Cambridge, MA 02138
United States
617-495-1174 (Phone)
617-384-9340 (Fax)

National Bureau of Economic Research (NBER) ( email )

1050 Massachusetts Avenue
Cambridge, MA 02138
United States
617-495-1174 (Phone)
617-496-3783 (Fax)

Register to save articles to
your library

Register

Paper statistics

Downloads
297
rank
91,180
Abstract Views
1,454
PlumX Metrics