Discounting Dollars, Discounting Lives: Intergenerational Distributive Justice and Efficiency

Louis Kaplow

No 12239, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: The view that intergenerational distributive justice and efficiency should be treated separately is familiar, yet controversial. This article elaborates the often-implicit justifications for separate treatment and provides a more express statement of how and when such treatment is appropriate. Substantial attention is devoted to an approach that holds constant the intra- and intergenerational distribution of well-being, which proves to be a valuable analytical device even for intergenerational policies that are not distribution neutral. Also explored are possible interrelationships between intergenerational distributive justice and efficiency, the choice of interest rate for discounting dollars, and how the present approach relates to those that would employ direct social weights to dollars at different points in time.

JEL-codes: D31 D61 D63 D81 D99 H23 H43 K32 Q38 Q58 (search for similar items in EconPapers)
Date: 2006-05
New Economics Papers: this item is included in nep-law and nep-pbe
Note: LE PE
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Citations: View citations in EconPapers (3)

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