Intergenerational equity and social discount rates: what have we learned over recent decades?

Abstract

Purpose The purpose of this paper is to examine what the significant contributions to the intergenerational equity and social discount rate (SDR) literature have been over recent decades and presents what policy progress has been made as a result. Design/methodology/approach The approach has been that of a literature survey. Findings The paper observes that only when academics agree, however, they can influence policy, as one major policy change for SDR demonstrates. Research limitations/implications Further research can analyse the application of SDRs in other jurisdictions. Practical implications A formal process of demonstrating academic consensus and its application to policy is recommended. Social implications SDRs are extremely important for government decision making. Spreading knowledge about how SDRs are created and used is therefore of great social importance. Originality/value This paper could usefully be read by government officials, as well as academics, worldwide. It is a contribution to knowledge not just in its subject matter but also in analysing the frontier between academic knowledge and progress on the one hand, and government decision making on the other.