Keywords: cost–benefit analysis, intergenerational efficiency, intergenerational fairness, stationarity, voting
Balancing efficiency and equity in long-run decision-making
The idea of this paper is that 'intergenerational majority rule voting' can sometimes be both efficient and equitable, as formalised by an intergenerational application of the Arrow axioms. A decision by the US Environmental Protection Agency to require carbon filtration of drinking water on the grounds of intergenerational equity provides an intuitive example of 'intergenerational majority rule voting'. The normative principle of intergenerational equity is, intuitively, similar to Jefferson's 'The world belongs in usufruct to the living' and the basis of the Supreme Court decision in Pennsylvania v. Planned Parenthood, which was to preserve the basic institutional structure of the 'rule of law' in especially divisive cases.