The Employment Distribution Paradox
In a typical developed economy, statistical data reveals two facts: 1) The vast majority of individual businesses are small, often with fewer than 10 employees. 2) The majority of the total workforce is employed by a small number of very large firms. Explain how these two facts can be true at the same time and what this implies about the concentration of employment.
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The 'Business as Usual' Scenario in the Stern Review
Discount Rate Calculation in the Stern Review
Criticism of the Stern Review's Low Discount Rate
The Employment Distribution Paradox
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Evaluating Long-Term Environmental Policy
A major 2006 economic report on climate change advocated for immediate, large-scale investment to prevent future environmental damage. Its cost-benefit analysis was based on a low discount rate, which gave significant weight to the welfare of future generations. Which of the following best describes the two primary justifications for the specific discount rate used in this report?
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- Approach 1: Uses a low discount rate to calculate the present value of future benefits.
- Approach 2: Uses a high discount rate to calculate the present value of future benefits.
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A major 2006 economic report on climate change advocated for immediate, large-scale investment to prevent future environmental damage. Its cost-benefit analysis was based on a low discount rate, which gave significant weight to the welfare of future generations. Which of the following best describes the two primary justifications for the specific discount rate used in this report?