Stern report argues that we should use 0% discount rate when discounting future costs of carbon dioxide emissions. A lot of economists disagree, one of the most prominent critics is W. Nordhous (co-author of Samuelsons book of Economics).

The use 0% discount rate also raises new questions, Free exhange is applying it to abortions and concludes that abortions can only make sense when the discount rate for utility is >0.

Correction by Valuethinker: “Stern actually uses a 0.1% discount rate.”

The goal of this site is to promote mr. Mankiw’s Pigou Club and pigovian taxes in general. Hopefully this site will grow and gain new supporters.

I will try to add a simple explanation of the externalities in the near future.