ABSTRACT
The calculation scheme known as Cost-Benefit Analysis (CBA) has evolved from a method to evaluate commercial investment projects into one to assess public expenditure projects, then becoming the evaluation technique of choice which looms large in the typical environmental economics textbook. Discounting implies that the value of the future use of a resource is evaluated as being less than its equivalent in the present. In the case of environmental cost-benefit evaluation, the benefits consist either of the avoidance of future environmental degradation or possibly of a future improvement of environmental conditions. The Faustian bargain of lack of concern about the fate of great-grandchildren finds no clear support in economic theory, whether Keynesian or neoclassical. Even if the objective assessment is that containment of global warming is unachievable, the response of accepting climate change and its adverse results as inevitable is not only an abdication of our moral responsibility for future generations, but also irrational.
