IDEAS home Printed from https://ideas.repec.org/a/cpp/issued/v6y1980i3p549-555.html
   My bibliography  Save this article

Discount Rates for Economic Appraisal of Public Sector Expenditures

Author

Listed:
  • Glenn P. Jenkins

Abstract

The question of what is the appropriate discount rate to employ in public sector investment appraisal has been the subject of a theoretical debate in the economics literature for over a decade. In recent years, however, most of the points of disagreement in the theory have become better understood and hence a large degree of reconciliation has taken place. Central to this controversy was whether the appropriate parameter to use as the social discount rate should be the social value of the marginal product of investment in the private sector, the social rate of time preference or the social opportunity cost of capital. This paper presents the different arguments on the Discount Rates for Economic Appraisal of Public Sector Expenditures.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Glenn P. Jenkins, 1980. "Discount Rates for Economic Appraisal of Public Sector Expenditures," Canadian Public Policy, University of Toronto Press, vol. 6(3), pages 549-555, Summer.
  • Handle: RePEc:cpp:issued:v:6:y:1980:i:3:p:549-555
    as

    Download full text from publisher

    File URL: http://links.jstor.org/sici?sici=0317-0861%28198022%296%3A3%3C549%3ADRFEAO%3E2.0.CO%3B2-6
    Download Restriction: only available to JSTOR subscribers
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or search for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. repec:bla:econom:v:38:y:1971:i:152:p:395-412 is not listed on IDEAS
    2. Sjaastad, Larry A & Wisecarver, Daniel L, 1977. "The Social Cost of Public Finance," Journal of Political Economy, University of Chicago Press, vol. 85(3), pages 513-547, June.
    3. Martin Feldstein & Lawrence Summers, 1983. "Inflation and the Taxation of Capital Income in the Corporate Sector," NBER Chapters, in: Inflation, Tax Rules, and Capital Formation, pages 116-152, National Bureau of Economic Research, Inc.
    4. DREZE, Jacques H., 1974. "Discount rates and public investment: A post-scriptum," LIDAM Reprints CORE 164, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    5. Kenneth J. Arrow & Robert C. Lind, 1974. "Uncertainty and the Evaluation of Public Investment Decisions," Palgrave Macmillan Books, in: Chennat Gopalakrishnan (ed.), Classic Papers in Natural Resource Economics, chapter 3, pages 54-75, Palgrave Macmillan.
    6. repec:bla:econom:v:41:y:1974:i:161:p:52-61 is not listed on IDEAS
    7. M. T. Sumner, 1980. "Benefit-Cost Analysis in Canadian Practice," Canadian Public Policy, University of Toronto Press, vol. 6(2), pages 389-393, Spring.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Anonymous, 1981. "Introduction [The Social Discount Rate for Canada: A Further Analysis]," Canadian Public Policy, University of Toronto Press, vol. 7(3), pages 378-380, Summer.
    2. Claude Montmarquette & Iain Scott, 2007. "Taux d'actualisation pour l'évaluation des investissements publics au Québec," CIRANO Project Reports 2007rp-02, CIRANO.
    3. M. T. Sumner, 1980. "Comments on the Public-Sector Discount Rate: Response to Jenkins [Benefit-Cost Analysis in Canadian Practice]," Canadian Public Policy, University of Toronto Press, vol. 6(4), pages 648-650, Autumn.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Marian MOSZORO, 2014. "Efficient Public-Private Capital Structures," Annals of Public and Cooperative Economics, Wiley Blackwell, vol. 85(1), pages 103-126, March.
    2. Liqun Liu & Andrew J. Rettenmaier & Thomas R. Saving, 2004. "A Generalized Approach to Multigeneration Project Evaluation," Southern Economic Journal, John Wiley & Sons, vol. 71(2), pages 377-396, October.
    3. Asplund, Disa, 2022. "The welfare-maximizing discount rate in a small open economy," Working Papers 2022:2, Swedish National Road & Transport Research Institute (VTI).
    4. Marian W. Moszoro, 2021. "The Public‐Sector Cost of Capital: An Empirical Test of Peltzman’s Conjecture," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 83(5), pages 1273-1285, October.
    5. Eduardo Fernández-Arias & Ricardo Hausmann & Ugo Panizza, 2020. "Smart Development Banks," Journal of Industry, Competition and Trade, Springer, vol. 20(2), pages 395-420, June.
    6. Sellin, Peter, 1998. "Monetary Policy and the Stock Market: Theory and Empirical Evidence," Working Paper Series 72, Sveriges Riksbank (Central Bank of Sweden).
    7. William E. Cullison, 1980. "Trends in federal taxation since 1950," Economic Review, Federal Reserve Bank of Richmond, vol. 66(May), pages 8-18.
    8. Simon Eckermann & Andrew R. Willan, 2016. "Expected Value of Sample Information with Imperfect Implementation," Medical Decision Making, , vol. 36(3), pages 282-283, April.
    9. Birgitte Grøgaard & Asmund Rygh & Gabriel R. G. Benito, 2019. "Bringing corporate governance into internalization theory: State ownership and foreign entry strategies," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 50(8), pages 1310-1337, October.
    10. Rausser, Gordon C. & de Janvry, Alain & Schmitz, Andrew & Zilberman, David D., 1980. "Principal issues in the evaluation of public research in agriculture," Department of Agricultural & Resource Economics, UC Berkeley, Working Paper Series qt74v9m7dh, Department of Agricultural & Resource Economics, UC Berkeley.
    11. Reinhard Mechler & Stefan Hochrainer & Asbjørn Aaheim & Håkon Salen & Anita Wreford, 2010. "Modelling economic impacts and adaptation to extreme events: Insights from European case studies," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 15(7), pages 737-762, October.
    12. Nathalie Berta, 2016. "On the definition of externality as a missing market," Post-Print halshs-01277990, HAL.
    13. Basu, Parantap & Ghosh, Satyajit, 2001. "Tax rate uncertainty, labor supply and saving in a nonexpected utility maximizing model," The Quarterly Review of Economics and Finance, Elsevier, vol. 41(1), pages 49-68.
    14. Cristiano Antonelli, 2017. "The derived demand for knowledge," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 26(1-2), pages 183-194, February.
    15. Bruno CRUZ & Aude POMMERET, 2002. "Does public investment reduce private investment risk ? A real option approach," LIDAM Discussion Papers IRES 2002039, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
    16. Tirelli, Mario, 2006. "The evaluation of public investments under uncertainty," Research in Economics, Elsevier, vol. 60(4), pages 188-198, December.
    17. Gollier, Christian, 2016. "Gamma discounters are short-termist," Journal of Public Economics, Elsevier, vol. 142(C), pages 83-90.
    18. Edward C. F. Wilson & Miranda Mugford & Garry Barton & Lee Shepstone, 2016. "Efficient Research Design," Medical Decision Making, , vol. 36(3), pages 335-348, April.
    19. Gray, Richard S., 1990. "The Role of Learning in Investment Decisions," 1990 Annual meeting, August 5-8, Vancouver, Canada 261490, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    20. Carsten Helm, 1998. "International Cooperation Behind the Veil of Uncertainty – The Case of Transboundary Acidification," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 12(2), pages 185-201, September.

    More about this item

    JEL classification:

    • H43 - Public Economics - - Publicly Provided Goods - - - Project Evaluation; Social Discount Rate

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cpp:issued:v:6:y:1980:i:3:p:549-555. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Iver Chong (email available below). General contact details of provider: https://www.utpjournals.press/loi/cpp .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.