A Biological Theory of Public Discounting by Prof. Arthur Robson (Simon Fraser University)

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• Prof. Arthur Robson (Simon Fraser University)
• Wednesday 21 May 2014, 16:30-17:30
• Keynes Room, Faculty of Economics, Cambridge.

If you have a question about this talk, please contact Cambridge-INET Institute, Faculty of Economics.

Event page: http://www.inet.econ.cam.ac.uk/our-events/Arthur-Robson-talk2

We consider a growth model in which intergenerational transfers are made via stocks of private and public capital. Private capital is the outcome of individuals’ private savings while decisions regarding public capital are made collectively. We hypothesize that private saving choices evolve through individual selection while public saving decisions are the result of group selection. The main result of the paper is that the equilibrium rate of return to private capital is at least 2-3% more than the rate of return to public capital. In other words, social choices involving intertemporal trade-offs exhibit much more patience than individual choices do.

This talk is part of the Cambridge-INET Institute, Faculty of Economics series.

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• Keynes Room, Faculty of Economics, Cambridge

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