Thursday, December 20, 2007

Computing Time Preference

Under orders to place a scant offering on the altar of public approval by erecting Christmas decorations, a thought came to mind. Could one not calculate the rate of time preference from these activities?

Placing lights consumes electricity, producing GHGs, warming the planet, reducing the probability of a white Christmas (which I'm told is a normal good) in future years. If you know the appropriate conversion between holiday lighting and holiday snow, how much pollution is caused by this additional consumption of electricity, plus if you knew the precise effects of global warming, you'd have arguably the most roundabout measure ever of time preference.

Assuming of course, full information, which never holds.

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