natural resources has characteristics similar to damages in the form of extinction of species.
On the short term such damages may seem unimportant but on the long term their
significance are not well understood.
Intergenerational decision making
In the following a general framework for sustainable decision making is considered with a
special emphasis on the intergenerational aspects, see also Faber and Rackwitz (2004). In
Rackwitz et al. (2004) the concept is outlined in detail in regard to socio economical decision
making for civil engineering decision making.
Decision making in the field of civil engineering often take basis in optimization problems of
the following form:
max ( (0))a(0)Ua (13.19)where is the total expected life cycle benefit and is a vector of decision alternatives
where the parameter 0 indicates that the decision alternatives which indeed might involve
activities in the future are decided upon at time
U() a(0)t 0 i.e. the time of the decision by the
present decision maker (present generation). In this formulation of the decision problem
utility is implicitly set equal to monetary benefits. In accordance with existing formulations
for life cycle costing the total expected life cycle benefits for a reference period T are
assessed as:
0( (0))aa ( , (0)) ( )
T
UtT6tdt (13.20)where T(, ) is the expected benefit per time unit and 6 ()t is a function capitalizing the
benefits possibly gained in the future into net present value. If equity of decision makers over
time is adopted as a principle this implies that the benefit function given in Equation (13.20)
must be extended with the preferences i.e. the benefits achieved by of the future decision
makers. The principle is illustrated in Figure 13.11. In this Figure it is indicated that the
exploitation of resources and the benefits achieved by this can be transferred between decision
makers at different times. In principle if a generation decides to exploit a resource which only
to a certain degree is recyclable a part of the benefit achieved by this generation must be
transferred to the next generation. In monetary terms this part must correspond to the
recycling costs plus compensate for the loss of the non-recyclable resource. The latter
compensation could e.g. be in terms of invested research aiming to substitute the resource
with fully recyclable resources.
Also costs, e.g. associated with the maintenance of structures, may be transferred between
decision makers at different times. In Figure 13.11 the joint decision maker is assumed to
make decisions for the best of all (also future decision makers) with equal weighing of the
preferences of the present and all future decision makers.