Temporal discounting (also called time discounting) refers to placing less value on a good that might be received the further in future it might be received.
Wikipedia (2021) Annual effective discount rate , Wikipedia . The most common example is capital, which is normally discounted to account for the fact that if money is spent later, it can accumulate interest. Wikipedia (2021) Social discount rate , Wikipedia . A related concept in social decision making.
Temporal discounting (also called time discounting)
is the discounting of the of the intrinsic value of a good the further into the future it occurs.
People often think that we should value goods in the future less than goods now. There are a variety of different reasons why we might discount the future: for instance, we might simply care less about the future than we do the present (this is known as pure time
preference). Alternately, we might care just as much about my future, but think that there is some probability that it will not be possible to reap the benefits at that time (for instance, I might care less about my personal income in 40 years, simply because there's a reasonable chance that I will be dead by then, and not able to enjoy the income). A variety of other reasons might apply, depending on the good under discussion.
Members of the effective altruism community have often argued against pure time discounting, and so for lower discounting of future welfare. This has
led some to focus on issues relating to the long-run future.
Owen. 2016. Discounting for uncertainty in health . Ord & Wiblin. 2016. Should we discount future health benefits when considering cost-effectiveness? .
Debate from researchers in the community.
Wikipedia. 2016. Annual effective discount rate.
The most common example is capital, which is normally discounted to account for the fact that if money is spent later, it can accumulate interest.
Wikipedia. 2016. Social discount rate.
A related concept in social decision making.