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Lecture 14

ECON BC 2075y Lecture 14: Lecture 14 Notes


Department
Economics
Course Code
ECON BC 2075y
Professor
Belinda Archibong
Lecture
14

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The Libertarian Pushback: Nozick’s Entitlement Theory Part I
Session 14 Topics
Fighting back with the libertarians- Introducing Nozick and the case against
redistributive taxation
Looking forward to many important questions here: affirmative action and
rectification , inheritance tax (just to transfer all your wealth to your children?)
The Libertarian case against taxation
Should we tax Bill Gates or Michael Jordan to help the poor?
Tax based on net worth
Should China pay the same as the US for Climate Change Policy?
Three different ways to look at carbon emissions
By country per year
By country over time
By country per person per year
Economics, Ethics and Climate Change: Care for Future Generations?
What would you pay today to avoid $100 in damage to your car a year from now
if 3% interest rate? 10 years from now? 30 years from now?
Higher the discount rate, less value future
The issue of the total discount rate in climate change discussions- ethics of
discounting the future?
Future consumption worth < current consumption (we are richer)
Pure time preference- controversial- prefer ct to ct+1 - but what about
future generations? Is it ethical to ever have a social rate of time
preference greater than 0
Climate Change: Economics and the Ethics of the Discount Rate
The discount rate is the single most important number in climate economics
Theories about the discount rate
Descriptive
Risk free rate of returns 1%
Present value of future is higher
Equal to market interest rate= 5%-7%
Present value of far future is insignificant
Prescriptive
Expected growth of wealth
Future generations will be richer
Discount future at expected growth in income
Rate if all generation had the same income
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