A ‘component-based’ approach to discounting for natural resource damage assessment

摘要: Abstract The paper proposes a ‘component-based’ approach to guide the choice of social discount rate in natural resources damage assessment, where time and discounting are key features. It is multi-rate scheme, which draws on concepts from dual-rate time-declining approaches. Each component discounted at component-specific constant rate, related its time-trajectory. Assuming normatively defined declining schedule rates as starting reference, components with longer profiles – generally represented by welfare losses lower than short-term — mainly remedial costs. rationale behind this that duration component, higher nonincident specific uncertainty resource values more relevant equity issues. When estimating total damage, resulting implicit average depends each relative relevance moment. From an operational point view, anchoring government prescriptions would support robustness estimates court law, whereas dual-based environmental based ad-hoc assumptions difficult justify.