Climate policies deserve a negative discount rate

Working paper de Marc Fleurbaey

We defend a methodology of discounting, for the evaluation of the long-term effects of climate policies, which relies on a social welfare objective, against the view that the market rate of return should be used for that purpose. We also show that in the long run, the discount rate for such policies should focus on the worst-case scenario for the most disadvantaged populations. As a consequence, it is likely that the appropriate discount rate for climate policies should be negative, implying a high priority for the future.

The author

Marc Fleurbaey is Robert E. Kuenne Professor at the University of Princeton (USA) and holds the Chaire “Welfare Economics and Social Justice” at the Collège d’études mondiales (Fondation Maison des sciences de l’homme, Paris). His research in economics and philosophy has been devoted to normative economics, distributive justice, and the evaluation of public policy. The main areas of application are the measurement of social welfare, climate policies, health prioritizing, and optimal taxation. He has been professor of economics and CNRS researcher in France.


Marc Fleurbaey, Stephane Zuber. Climate policies deserve a negative discount rate. FMSH-WP-2012-19. 2012