A time preference measure of the social discount rate for the UK

In this study the social discount rate for the UK is estimated, the result compared with the Treasury approved rate and the main associated policy implications considered. A case is argued for reducing the official discount rate in appraisals involving all long-term social projects. The estimate of the elasticity of the marginal utility of consumption, an important component of the discount rate, is supported by plausible and statistically valid regression results. The need for further work relating to other major European countries is identified so that discount rate comparisons can be made on a consistent basis.