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Discount Rate

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PPGPortal > Home > Concept Dictionary > D, E > Discount Rate
 

Discount Rate 

The rate chosen to discount future benefits, usually assessed as the opportunity costs of capital.

(Pal 2006, 322) 

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Discount rates are often important in measuring the performance of government programs. The utility of this concept for program evaluation can be better understood if one conceives of the discount rate as measuring the opportunity costs of capital. In other words, one must consider the rate of return which would be achieved if program sums were invested in the private sector. 

References

 

Pal, Leslie. 2006. Beyond Policy Analysis: Public Issue Management in Turbulent Times, 3rd ed. Toronto: Nelson Education.

 

     

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