A survey of philosophers finds that they broadly agree with economists about how best to value the future environment in policy decisions being made now, albeit for different reasons.
In a new study published in Nature Climate Changeenvironmental economists, including Professor Ben Groom of the University of Exeter, found a consensus between the two academic disciplines on an aspect of climate policy known as the “social discount rate”, with philosophers offering their support for a rate of 2 %, a value predominantly supported by economists, and which is in line with UN climate goals.
Governments use social discount rates to determine how future costs and benefits, such as the impacts of climate mitigation projects, policies, and programs, are valued today.
A low discount rate places greater value on benefits for future generations, such as those created by avoiding the burning of fossil fuels, and increases the costs of carbon emissions used in evaluating public investment.
The researchers analyzed survey data from more than 200 economists and philosophers with expertise in social discounting, who provided a variety of qualitative and quantitative responses.
They found considerable agreement between the two disciplines for a long-run social discount rate of 2% and, analyzing the survey data, found that in each discipline the mean discount value resulted in temperature changes of about 1, 4 degrees C by the end of the century. a figure in line with the UN’s Paris climate goals.
Small changes to the SDR have major policy implications: the Trump administration’s SDR increase from 3% to 7% reduces the social cost of carbon by a factor of seven, while New York state’s decision to reduce its SDR to 2% instead of 3% increased the social cost of carbon from $40 to $125 per ton of CO2.
The study is the first to try to generate an expert consensus on social discount rates outside the field of economics.
Expert advice, predominantly from economists, plays a key role in discounting and its application to climate policy, but the underlying ethical issues at stake are outside the expertise of most economists.
Thus, the findings strengthen economists’ arguments for a 2% social discount rate by backing it with ethical concerns for the well-being of future generations and ‘intergenerational fairness’.
Professor Ben Groom, Dragon Capital Chair in Biodiversity Economics at the University of Exeter, said: “That economists and philosophers can agree on policy outcomes builds a consensus of academic experts, and the paper will help build consensus in favor of the new guidance as it progresses. through the United States government.
“The different perspectives of philosophers are complementary to those of economists and offer ethical checks and balances within integrated assessment models to narrow down the set of acceptable climate policies, or offer entirely different procedural lenses through which to assess the climate policy. These ideas will be overlooked if economists continue to dominate the social discount debate.”