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Discounting and relative prices in assessing future environmental damages


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Title: Discounting and relative prices in assessing future environmental damages
Authors: Sterner, Thomas
Hoel, Michael
Issue Date: 2006
University: Göteborg University. School of Business, Economics and Law
Extent: 23 pages
322090 bytes
Publication type: Report
Series/Report no.: Working Papers in Economics, nr 199
Keywords: Discounting; future costs; scarcity; environment; climate change
Abstract: Environmentalists are often upset at the effect of discounting costs of future environmental damage, e.g. due to climate change. An often overlooked message is that we should discount costs but also take into account the increase in the relative price of the ecosystem service endangered. The effect of discounting would thus be counteracted, and if the rate of price rise of the item was fast enough it might even be reversed. The scarcity that leads to rising relative prices for the environmental ... more
ISSN: 1403-2465
URI: http://hdl.handle.net/2077/2722
Appears in Collections:Working papers

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