Abstract
Discounting the utilities of future generations in many problems, such as climate-change analysis, has several justifications, only one of which can be supported by ethics which postulate that every individual, no matter when born, has an equal right to well-being. That justification is that future generations may not exist. In an earlier article published here, I explained this view, and criticized economists who deviate from it: the practical aspect of this deviation is to choose discount rates which are far too high, thus relegating future generations to lower utility than they a priori have a right to. As well, many economists continue to rely upon a utilitarian ethic, a reliance which is independent of the discounting issue, but which I also criticize. Dasgupta responded to my article; the present article is a response to Dasgupta.
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Notes
The ‘ex ante’ caveat is needed as it will become clear below that the uncertain existence of future generations provides a legitimate reason not to guarantee each generation as much (potential) welfare as every other generation.
I say a version, because he imposes an ethical view on intergenerational inequality by postulating a particular utility function \(u\), incorporated in the elasticity \(\eta \).
We use ‘human development’ as the expression of growth in utility, because, in our model, utility is a function of education and knowledge as well as consumption and leisure. This was discussed in Roemer (2011, Sect. 5).
References
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The positions taken in this note are shared by my co-authors H. Llavador and J. Silvestre.
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Roemer, J.E. Once More on Intergenerational Discounting in Climate-Change Analysis: Reply to Partha Dasgupta. Environ Resource Econ 56, 141–148 (2013). https://doi.org/10.1007/s10640-013-9694-3
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DOI: https://doi.org/10.1007/s10640-013-9694-3