Pascal Lamy, Rod Eddington, Ross Garnaut, Laura Eadie and John Langmore; Centre for Policy Development Seminar Series, 26 May 2014, Melbourne University.
Four prominent panellists discussed the hidden choices we make when selecting discount rates for long-term investments.
The roundtable was filmed in front of an invited audience. The ‘event snapshot‘ document summarises the discussion.
Valuing the future is central to many contemporary debates. For example, how do we consider the welfare of future generations? Who decides what society values, now or in future? Where will future growth come from?
Discount rates allow us to compare the future valuation of something to its valuation in today’s currency.They are used to weigh up costs and benefits at different points in time.
They can also reflect how much a society is willing to invest for the future, and how much to consume today.
Governments make implicit judgements about the value of current relative to future benefits when they select discount rates for evaluating investments.
This event aimed to make explicit the choices that are made when we select a discount rate for evaluating long term investments.