New South Wales


Discounting the future re-examined


From: Wednesday May 10, 2023, 12:30 pm

To: Wednesday May 10, 2023, 1:30 pm

About this Seminar

Join us for this lunchtime seminar where Mike Smart, Chief Economist at IPART, will discuss "Discounting the future re-examined: how climate change makes us think differently about the time value of money, and what that means for economic regulation".

Economic regulators often discount future cashflows by the Weighted Average Cost of Capital (WACC) of a benchmark firm. However, this ignores the inter-generational externality. For essential services infrastructure with mullti-decade economic lives, this can be important. It may be appropriate to consider a Social Discount Rate (SDR) that gives weight to the preferences of future generations - no more so than when considering investments to mitigate or adapt to climate change. In this presentation, Mike will explain the differences between the SDR and WACC, and then illustrate how a SDR could lead to different regulatory outcomes on pricing and licensing questions, including implications for public versus private delivery of services.

Speaker Biography

Mike Smart - Deputy, IPART 
BA Magna Cum Laude in Astrophysics from Harvard

Mike has been the Chief Economist at IPART since May 2015 and was appointed a Deputy Tribunal member in February 2020. Prior to these IPART roles, he was a consulting economist in private practice for 15 years.

Mike has given expert evidence in the Federal Court of Australia and the Australian Competition Tribunal. He advised the Public Accounts Committee of the NSW Parliament on inquiries into the Forestry Commission and financing urban infrastructure.  His academic training is in astrophysics and his early career work was in engineering and physical sciences.

Registration and Joining this Event

This is a hybrid event, being held in-person at Macquarie University City Campus, and online via Zoom.

To register please book below.

If attending in-person please see reception on Level 24 at Macquarie University City Campus, 123 Pitt Street, upon arrival.

If you are attending via Zoom the link to join will be sent 24 hours prior.

Please select how you will attend the event via the drop down selection when registering.

Members should login before registering to avoid paying $10 non-member fee.



Disclaimer: The Economic Society of Australia promotes discussion of evidence-based work.  The views and opinions expressed here are those of author(s) and do not necessarily reflect the official policy or position of the Economic Society of Australia (NSW Branch) or its council members. 


Bookings are now closed


Macquarie University City Campus, room 2415, level 2

123 Pitt Street, Sydney NSW 2000

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