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Positively gamma discounting: combining the opinions of experts on the social discount rate

Freeman, Mark C. and Groom, Ben (2015) Positively gamma discounting: combining the opinions of experts on the social discount rate. Economic Journal, 125 (585). pp. 1015-1024. ISSN 0013-0133

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Identification Number: 10.1111/ecoj.12129

Abstract

The aggregated term structure of social discount rates that results from Weitz-man's (2001) survey of expert opinion is shown to be highly sensitive to the nature of the responses. If variation re.ects irreducible differences in ethical judgements, the term structure can decline rapidly. If variation occurred because respondents were forecasting future rates under uncertainty, the term structure is much flatter because additional experts provide new information. The former approach triples the social cost of carbon when compared to the latter. The distinction between heterogeneity and uncertainty illustrates the need for a nuanced treatment of survey data in intergenerational policy making.

Item Type: Article
Official URL: http://onlinelibrary.wiley.com/doi/10.1111/ecoj.12...
Additional Information: © 2014 Royal Economic Society
Divisions: Geography & Environment
Subjects: H Social Sciences > H Social Sciences (General)
H Social Sciences > HC Economic History and Conditions
Sets: Departments > Geography and Environment
Date Deposited: 23 Jun 2014 15:50
Last Modified: 11 Sep 2019 14:51
URI: http://eprints.lse.ac.uk/id/eprint/57158

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