Journal of
Marketing Development and Competitiveness
Scholar Gateway
Abstracts prior to volume 5(1) have been archived!Issue 5(1), October 2010 -- Paper AbstractsGirard (p. 9-22)Cooper (p. 23-32)Kunz-Osborne (p. 33-41)Coulmas-Law (p.42-46)Stasio (p. 47-56)Albert-Valette-Florence (p.57-63)Zhang-Rauch (p. 64-70)Alam-Yasin (p. 71-78)Mattare-Monahan-Shah (p. 79-94)Nonis-Hudson-Hunt (p. 95-106) 
JOURNAL OF APPLIED BUSINESS AND ECONOMICS
Optimizing Discount Rates: Expressing Preferences for Sustainable Outcomes
in Present Value Calculations
Author(s): David Axelrod
Citation: David Axelrod, (2017) "Optimizing Discount Rates: Expressing Preferences for Sustainable Outcomes in Present Value Calculations," Journal of Applied Business and Economics, Vol. 19, Iss.1, pp. 9-19
Article Type: Research paper
Publisher: North American Business Press
Abstract:
This paper describes how the discount rate used in present value calculations expresses the preference for sustainability in decision making, and its implication for sustainable economic growth. In essence, the lower the discount rate, the greater the regard for the future, and the more likely we choose behaviors that lead to long-term sustainability. The theoretical framework combines behavioral economics and holonomics, which involve limitations of regard for the future due to constraints on processing uncertainty. An alternative formulation for present value calculations, which includes a survival function, is developed. A taxonomy of institutions based on discount rate is proposed.
