Using data from financial reorganization plans filed by insolvent Canadian firms, we estimate the discount rate implicit in the unsecured creditors' reorganization decision. Using (HARA) utility functions, we find the implicit monthly discount rate of creditors to be 4.9%, which corresponds to an annual discount rate of 77%. This is 7 to 10 times higher than discount rates used in previous empi...

Which rates should we use to discount costs and benefits of different nature at different time horizons? We answer to this question by considering a representative agent consuming two goods whose availability evolves over time in a stochastic way. We extend the Ramsey rule by taking into account of the degree of substitutability between the two goods and of the uncertainty surrounding the econo...

the rate of time preference plays an important role in discounting instantaneous utility in economic growth models and also in calculating social discount rate in cost-benefit analysis. in empirical researchers, this rate is assumed to be constant. however, the rate of time preference might vary over time. this paper develops a new algorithm to estimate this rate as a varied coefficient for the...

Time preferences are a dominant influence in cost-benefit analyses of long-term issues such as climate change. FUND, a model for optimal emission control, is used to spell out this influence. Classic discounting at various rates is contrasted with Heal discounting where the discount factor depends logarithmically on the time distance (it does linearly in the classic case), and Rabl discounting ...

This paper refracts Gordon Tullock’s The Social Dilemma onto a framework of spontaneous order theorizing, and finds the refraction to work well. The Social Dilemma reveals Gordon Tullock to be a theorist whose conceptualizations are anchored in a societal setting represented better by networks than by fields, and where societal outcomes emerge out of local networked interaction. The theoretical...