as our analysis has shown. Hence, moving from DU to SDU matters empirically.
Furthermore, this result is robust in the sense that the difference between DU and
SDU remains substantial even if a high utility discount rate is applied (we looked at
rates up to 5% per annum).
This last observation is particularly significant. In the introduction, we found
ourselves agreeing with the arguments of Arrow, Dasgupta, Rawls and others that
the use in climate-policy evaluation of undiscounted utilitarianism, or similarly the
use of DU with a near-zero utility discount rate, leads to unappealing transfers of
wealth from the present to the future, when applied consistently across the wider
set of investment opportunities. Our analysis shows that concern for the wellbeing
of future generations might be better taken into account using SDU with a positive
utility discount rate substantially away from zero. What precisely that rate should
be, when used alongside SDU, ought to be the focus of a renewed discussion, which is
beyond the scope of this paper. In any case, we have shown that, within a relatively
broad range, tough emissions abatement schedules will continue to increase social
welfare.
At a spatially disaggregated level, climate change may lead to reduced wellbeing
(even when compared to present wellbeing) for certain groups, but not for others.
Provided that large-scale compensation schemes will not be undertaken, this applies
in particular to those living in geographical areas where climate change is likely to
be especially severe, and/or where vulnerability is particularly high. One example is
likely to be marginal agricultural regions in Africa; another may be low-lying coastal
communities in South and Southeast Asia. At such a disaggregated level, it will
matter much more to apply SDU instead of DU, as SDU in effect does not discount
the utility loss due to climate change for those groups that are so severely affected.
Therefore, it will be of great interest to apply the SDU criterion (or a similar
criterion - extended rank-discounted utilitarianism - proposed by Zuber and Asheim,
2011) for evaluating climate change in models where effects are disaggregated on
groups, and compare DU to alternative criteria in such a setting. We will turn to
this in future work. However, even the present analysis is strongly indicative of the
importance of broadening the basis of climate-policy evaluation from DU to SDU
and beyond.
Finally, we should comment on the prospect that SDU might actually be applied
in policy-making. SDU is the outcome of an explicitly ethical approach to policy
evaluation (and within that, an axiomatic approach). As such, one is challenged
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