Discounting, On Stilts

This paper provides a critical overview of several articles presented at the Intergenerational Discounting and Intergenerational Equity Conference held at the University of Chicago Law School on April 27-28, 2006. First, it demonstrates that conventional normative justifications offered for the use of discounting future costs and benefits for policy analysis in the intergenerational context do not withstand scrutiny. Second, it observes that the compensatory transfers that are sometimes thought to sanitize the cost-benefit procedure in the intergenerational context are deeply problematic, both in their theoretical construction and in their practical adequacy for the tasks they are being deployed to accomplish. Third, it argues that although some analysts have been careful to acknowledge the need to address questions of intergenerational equity directly through other policy mechanisms, these analysts have understated the difficulty of limiting discounted cost-benefit analysis to its proper sphere of competence