The social discount rate in the evaluation of investment projects: an application for Ecuador

The standard social discount rate of 12% applied by planning institutions and multilateral agencies when evaluating public projects is a constant administrative parameter that is unsupported and unresponsive to changes in social preferences over time. This paper presents an alternative way of determ...

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Autores principales:	Castillo, José Gabriel, Zhangallimbay, Donald
Formato:	Texto
Lenguaje:	English
Publicado:	2021
Materias:	INVERSIONES PROYECTOS DE DESARROLLO PREPARACION DE PROYECTOS EVALUACION DE PROYECTOS IGUALDAD ECONOMIA DEL BIENESTAR MODELOS MATEMATICOS PAISES EN DESARROLLO INVESTMENTS DEVELOPMENT PROJECTS PROJECT PREPARATION PROJECT EVALUATION EQUALITY WELFARE ECONOMICS MATHEMATICAL MODELS DEVELOPING COUNTRIES
Acceso en línea:	https://hdl.handle.net/11362/47523
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spelling	oai-11362-475232021-12-06T18:33:09Z The social discount rate in the evaluation of investment projects: an application for Ecuador Castillo, José Gabriel Zhangallimbay, Donald INVERSIONES PROYECTOS DE DESARROLLO PREPARACION DE PROYECTOS EVALUACION DE PROYECTOS IGUALDAD ECONOMIA DEL BIENESTAR MODELOS MATEMATICOS PAISES EN DESARROLLO INVESTMENTS DEVELOPMENT PROJECTS PROJECT PREPARATION PROJECT EVALUATION EQUALITY WELFARE ECONOMICS MATHEMATICAL MODELS DEVELOPING COUNTRIES The standard social discount rate of 12% applied by planning institutions and multilateral agencies when evaluating public projects is a constant administrative parameter that is unsupported and unresponsive to changes in social preferences over time. This paper presents an alternative way of determining the social discount rate based on the gamma estimation model (Weitzman, 2001) in a developing-country context, which has three advantages: (i) it incorporates decreasing discounting, (ii) it is cost-efficient in that it sums up the various expert opinions and (iii) it adjusts for changes in short- and long-term preferences. Our estimates are lower than the standard nominal rate for different time periods, ranging from 2% for evaluation horizons longer than 51 years to 11% for the short term (0–5 years). 2021-12-01T23:50:46Z 2021-12-01T23:50:46Z 2021-08-31 Texto Sección o Parte de un Documento https://hdl.handle.net/11362/47523 LC/PUB.2021/13-P 4 en CEPAL Review CEPAL Review 134 .pdf application/pdf ECUADOR ECUADOR
institution	Cepal
collection	Cepal
language	English
topic	INVERSIONES PROYECTOS DE DESARROLLO PREPARACION DE PROYECTOS EVALUACION DE PROYECTOS IGUALDAD ECONOMIA DEL BIENESTAR MODELOS MATEMATICOS PAISES EN DESARROLLO INVESTMENTS DEVELOPMENT PROJECTS PROJECT PREPARATION PROJECT EVALUATION EQUALITY WELFARE ECONOMICS MATHEMATICAL MODELS DEVELOPING COUNTRIES
spellingShingle	INVERSIONES PROYECTOS DE DESARROLLO PREPARACION DE PROYECTOS EVALUACION DE PROYECTOS IGUALDAD ECONOMIA DEL BIENESTAR MODELOS MATEMATICOS PAISES EN DESARROLLO INVESTMENTS DEVELOPMENT PROJECTS PROJECT PREPARATION PROJECT EVALUATION EQUALITY WELFARE ECONOMICS MATHEMATICAL MODELS DEVELOPING COUNTRIES Castillo, José Gabriel Zhangallimbay, Donald The social discount rate in the evaluation of investment projects: an application for Ecuador
description	The standard social discount rate of 12% applied by planning institutions and multilateral agencies when evaluating public projects is a constant administrative parameter that is unsupported and unresponsive to changes in social preferences over time. This paper presents an alternative way of determining the social discount rate based on the gamma estimation model (Weitzman, 2001) in a developing-country context, which has three advantages: (i) it incorporates decreasing discounting, (ii) it is cost-efficient in that it sums up the various expert opinions and (iii) it adjusts for changes in short- and long-term preferences. Our estimates are lower than the standard nominal rate for different time periods, ranging from 2% for evaluation horizons longer than 51 years to 11% for the short term (0–5 years).
format	Texto
author	Castillo, José Gabriel Zhangallimbay, Donald
author_facet	Castillo, José Gabriel Zhangallimbay, Donald
author_sort	Castillo, José Gabriel
title	The social discount rate in the evaluation of investment projects: an application for Ecuador
title_short	The social discount rate in the evaluation of investment projects: an application for Ecuador
title_full	The social discount rate in the evaluation of investment projects: an application for Ecuador
title_fullStr	The social discount rate in the evaluation of investment projects: an application for Ecuador
title_full_unstemmed	The social discount rate in the evaluation of investment projects: an application for Ecuador
title_sort	social discount rate in the evaluation of investment projects: an application for ecuador
publishDate	2021
url	https://hdl.handle.net/11362/47523
work_keys_str_mv	AT castillojosegabriel thesocialdiscountrateintheevaluationofinvestmentprojectsanapplicationforecuador AT zhangallimbaydonald thesocialdiscountrateintheevaluationofinvestmentprojectsanapplicationforecuador AT castillojosegabriel socialdiscountrateintheevaluationofinvestmentprojectsanapplicationforecuador AT zhangallimbaydonald socialdiscountrateintheevaluationofinvestmentprojectsanapplicationforecuador
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The social discount rate in the evaluation of investment projects: an application for Ecuador

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