Criticism of the Stern Review's Low Discount Rate
Several economists, notably William Nordhaus, challenged the Stern Review for its use of a low discount rate, advocating for a higher rate of 4.3%. [2] Nordhaus contended that Stern's rate gives excessive weight to impacts in the distant future. [2, 8] He concluded that applying a higher, more conventional discount rate would cause the review's 'dramatic results'—its urgent policy recommendations—to 'disappear'. [2, 12]
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