Ecological intuition versus economic "reason"

Roger Guesnerie (), Jean-Michel Lasry and Olivier Guéant
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Jean-Michel Lasry: Université Paris Dauphine-PSL - PSL - Université Paris Sciences et Lettres, CEREMADE - CEntre de REcherches en MAthématiques de la DEcision - Université Paris Dauphine-PSL - PSL - Université Paris Sciences et Lettres - CNRS - Centre National de la Recherche Scientifique

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Abstract: This article discusses the discount rate to be used in projects that aimed at improving the environment. The model has two different goods, one is the usual consumption good whose production may increase exponentially, the other is an environmental good whose quality remains limited. The stylized world we describe is fully determined by four parameters, reflecting basic preferences "ecological" and intergenerational concerns and feasibility constraints. We define an ecological discount rate and examine its connections with the usual interest rate and the optimized growth rate. We discuss, in this simple world, a variety of forms of the precautionary principle.

Keywords: relative prices; environmental goods; ecological discount rate; discount rate; irreversible damage; precautionnary principle (search for similar items in EconPapers)
Date: 2009-10
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00575067v1
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Related works:
Journal Article: Ecological Intuition versus Economic “Reason” (2012)
Working Paper: Ecological intuition versus economic "reason" (2012)
Working Paper: Ecological intuition versus economic "reason" (2012)
Working Paper: Ecological intuition versus economic "reason" (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:psewpa:halshs-00575067

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