Dynamic public good provision under time preference heterogeneity
Philip Trammell (Global Priorities Institute and Department of Economics, University of Oxford)
GPI Working Paper No. 9-2021
I explore the implications of time preference heterogeneity for the private funding of public goods. The assumption that players use a common discount rate is knife-edge: relaxing it yields substantially different equilibria, for two reasons. First, time preference heterogeneity motivates intertemporal polarization, analogous to the polarization seen in a static public good game. In the simplest settings, more patient players spend nothing early in time and less patient players spending nothing later. Second, and consequently, time preference heterogeneity gives less patient players a “first-mover advantage”. Departures from the common-discounting assumption are economically significant: a patient player’s payoff in equilibrium, relative to that obtained when he is constrained to act according to a higher discount rate, typically grows unboundedly as his share of the initial budget falls to zero. Finally I discuss applications of these results to the debate over legal disbursement minima.
Other working papers
The unexpected value of the future – Hayden Wilkinson (Global Priorities Institute, University of Oxford)
Various philosophers accept moral views that are impartial, additive, and risk-neutral with respect to betterness. But, if that risk neutrality is spelt out according to expected value theory alone, such views face a dire reductio ad absurdum. If the expected sum of value in humanity’s future is undefined—if, e.g., the probability distribution over possible values of the future resembles the Pasadena game, or a Cauchy distribution—then those views say that no real-world option is ever better than any other. And, as I argue…
Altruism in governance: Insights from randomized training – Sultan Mehmood, (New Economic School), Shaheen Naseer (Lahore School of Economics) and Daniel L. Chen (Toulouse School of Economics)
Randomizing different schools of thought in training altruism finds that training junior deputy ministers in the utility of empathy renders at least a 0.4 standard deviation increase in altruism. Treated ministers increased their perspective-taking: blood donations doubled, but only when blood banks requested their exact blood type. Perspective-taking in strategic dilemmas improved. Field measures such as orphanage visits and volunteering in impoverished schools also increased, as did their test scores in teamwork assessments…
Existential risk and growth – Leopold Aschenbrenner (Columbia University)
Human activity can create or mitigate risks of catastrophes, such as nuclear war, climate change, pandemics, or artificial intelligence run amok. These could even imperil the survival of human civilization. What is the relationship between economic growth and such existential risks? In a model of directed technical change, with moderate parameters, existential risk follows a Kuznets-style inverted U-shape. …