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Social Discount Rates from Stratospheric Ozone Control *
Author(s) -
AGEE MARK D.,
FAH KENNETH C.
Publication year - 1995
Publication title -
economic record
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.365
H-Index - 42
eISSN - 1475-4932
pISSN - 0013-0249
DOI - 10.1111/j.1475-4932.1995.tb01885.x
Subject(s) - ozone layer , offset (computer science) , montreal protocol , ozone , environmental science , range (aeronautics) , economics , social benefits , ozone depletion , econometrics , meteorology , computer science , geography , chemistry , engineering , aerospace engineering , tailings , programming language
We develop a model of optimal project timing to infer the discount rate US residents attach to investments in stratospheric ozone preservation. In this model, the calendar date at which preservation‐related benefits offset costs is shown to be an increasing function of the real social rate of time preference. Estimates of US costs and benefits associated with the original (1987) Montreal Protocol are used to determine a range of discount rates from the US control of stratospheric ozone depletion. From this example the range is about 3.0 to 8.77 per cent.