We consider the problem of the optimal use of a good whose consumption can produce damages in the future. Scientific progress is made over time that provides information on the distribution of the intensity of damages. We show that this progress induces earlier prevention effort only if prudence...

We discuss the selection of the socially optimal discount rate for public investment projects that entail costs and benefits in the very long run. More specifically, we examine in an expected utility framework how the uncertainty on the growth rate of the GNP per head affects this rate. Under...

By using their financial reserves efficiently, pension funds can smooth shocks on asset returns, and can thus facilitate intergenerational risk-sharing. In addition to the primary benefit of improved time diversification, this form of risk allocation affords the additional benefit of allowing...