IDEAS home Printed from https://ideas.repec.org/h/pal/intecp/978-1-349-02917-4_16.html
   My bibliography  Save this book chapter

A Challenge to the Monopoly of the Rate of Discount in Investment Choices

In: The Economics of Public Services

Author

Listed:
  • Jacques Thédié

    (Ministère de L’Équipement)

Abstract

Economic decisions almost always require intertemporal arbitrage. These arbitrage calculations are performed with the aid of a discount rate. In the classical theory of discounting, this rate is such that, for the marginal investments, the aggregated value of the benefit is equal to the invested capital The thesis of the present author is that the capital itself, independent of all intertemporal arbitrage, has an opportunity cost. The investment equilibrium depends not only on the discount rate, but also on the opportunity cost, which is as important as the rate of discount. The determination of the discount rate therefore is modified, as, of course, are all of the resulting choices.

Suggested Citation

  • Jacques Thédié, 1977. "A Challenge to the Monopoly of the Rate of Discount in Investment Choices," International Economic Association Series, in: Martin S. Feldstein & Robert P. Inman (ed.), The Economics of Public Services, chapter 16, pages 390-403, Palgrave Macmillan.
    • Handle: RePEc:pal:intecp:978-1-349-02917-4_16
    DOI: 10.1007/978-1-349-02917-4_16
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Citations

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


    Cited by:

    1. Jean Tirole, 1981. "Taux d'actualisation et optimum second," Revue Économique, Programme National Persée, vol. 32(5), pages 829-869.

    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:pal:intecp:978-1-349-02917-4_16. 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.

    We have no bibliographic references for this item. You can help adding them by using 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: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.palgrave.com .

    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.