Pooling Expert Opinion on Environmental Discounting: An International Delphi Survey

Abstract

The primary aim of this study is to examine the various issues involved in environmental discounting using a Delphi\n\t\t\t\t survey of a worldwide panel drawn from specialists in issues relating to discounting and long-term investment\n\t\t\t\t evaluation. The environmental discount rate is applied when performing cost–benefit analysis (CBA) on projects\n\t\t\t\t with environmental impact, in order to aggregate tangible and intangible effects. A review of the preceding\n\t\t\t\t literature shows that, after decades of academic debate, opinions have gradually converged. Furthermore, public\n\t\t\t\t administrations have begun to echo the need for a new look at the long-term discounting. One of the main findings\n\t\t\t\t of this study is the virtual unanimity of experts regarding the need to modify the approach to intergenerational\n\t\t\t\t discounting. The survey also yields a proposal for specific values for discount rates, based on the time horizon for\n\t\t\t\t the project under evaluation. The application of the resulting rates in the socio-economic evaluation of a project\n\t\t\t\t of environmental restoration provides numerical evidence of the importance of the choice of both discount rate\n\t\t\t\t and discount strategy.