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Title: Pareto criterion and long-term perspective criterion under myopic discounting
Authors: Kang, Minwook
Wang, Lei
Keywords: Pareto Criterion
Long-term Perspective Criterion
Social sciences::Economic development
Issue Date: 2019
Source: Kang, M., & Wang, L. (2019). Pareto criterion and long-term perspective criterion under myopic discounting. Economics Bulletin, 39(1), 24-32.
Series/Report no.: Economics Bulletin
Abstract: Under myopic discounting, which encompasses the famous psychological and economics model, hyperbolic discounting preferences, this paper shows that efficiency by the Pareto criterion is a sufficient condition for efficiency by the long-term perspective criterion. This result provides additional justification for Pareto-improving policies under myopic discounting by showing that such policies improve normative preferences as well. As an application of our result, we provide an example of Laibson's Pareto-improving consumption tax.
ISSN: 1545-2921
Rights: © 2019 The Author(s) (published by AccessEcon LLC). This is an open-access article distributed under the terms of the Creative Commons Attribution License.
Fulltext Permission: open
Fulltext Availability: With Fulltext
Appears in Collections:SSS Journal Articles

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