Why the far-distant future should be discounted at its lowest possible rate

A critical feature of the distant future is currently unresolvable uncertainty about what will then be the appropriate rate of return on capital io use for discounting. This paper shows that there is a well-defined sense in which the "lowest possible" interest rate should be used for discounting the far-distant future part of any investment project. Some implications are discussed for evaluating long-term environmental projects or activities, like measures to mitigate the possible effects of global climate change. (C) 1998 Academic Press.