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Paper Summaries/Calibration Against Official US Valuation Methods: VSL and the Social Cost of Carbon
Paper #1028
Calibration Against Official US Valuation Methods: VSL and the Social Cost of Carbon
Calibrates SAPM welfare-ledger parameters against official U.S. VSL and SCC methods, with vintage discipline: DOT current guidance lists $14.2M for 2025 VSL, EPA 2023 is the source for the $190 SCC, HHS/USDA values are annual table lookups, and EPA began revisiting SCC in 2025.
Reading welfare beta
Welfare beta, written as βW and pronounced beta W, means annual system-welfare loss divided by annual industry revenue, written as Π and pronounced capital pi. Revenue is the denominator, never profit; ΔW and Π must use the same domain, same time period, and same activity boundary. See the welfare-beta methodology manual.
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Theorem status: evidence-traced claim under the cited paper's assumptionsFalsification: show the same game preserving system welfare without changing the payoff structure
KEY FINDINGS
THEOREM
Theorem 1 (VSL Consistency): VSL_ledger ∈ VSL_federal. Theorem 2 (SCC Consistency): SCC_ledger = SCC_federal in nominal terms, and SCC_ledger < SCC_federal in real terms.
PLAIN ENGLISH
The ledger’s VSL and SCC parameters are defensible only when stated as versioned federal benchmarks with sensitivity, conformance, and falsification checks.
EVIDENCE & LIMITATIONS
- Theorem status: evidence-traced claim under the cited paper's assumptions
- Falsification: show the same game preserving system welfare without changing the payoff structure
REFERENCES / CITATION STATUS
References section
Detected
Bibliography entries
47
In-text citations
0
Unique citations
25
Footnote markers
44
Citation year span
1907-2024
Source hash
32c6485158af
This page reports reference counts measured directly from the manuscript. Full reference entries render only when a curated source chapter carries a public References, Bibliography, Source Notes, Supplemental Reference Archive, Footnotes, or Source-Grounding Ledger section. The site does not synthesize citation entries. Literature-claim verification status: not evaluated.
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EXECUTIVE SUMMARY
The paper reconciles the welfare-ledger VSL and SCC values with federal practice and makes parameter vintage explicit. βW is annual system-welfare loss divided by annual industry revenue over the same domain, time period, and activity boundary. βW = pending reconciliation means annual loss exceeds revenue; βW < 1 means loss is smaller than revenue; βW < 0 means the activity increases system welfare. ΔW is accounting attribution unless a separate causal design is stated. The manuscript treats VSL and SCC as versioned federal parameters. The ledger default VSL of $11.5M was a 2023-vintage value; current DOT guidance lists $14.2M for 2025 analyses. The $190 SCC comes from EPA 2023 at a 2% near-Ramsey discount rate, while EPA announced in 2025 that it was revisiting the social cost of carbon. The paper adds a conformance rule, falsification condition, and μ* ladder for translating ΔW into enforceable control prices.
METHODOLOGY
Federal-method reconciliation for VSL and SCC, sensitivity-table discipline, conformance requirements, and falsification conditions. Current federal values were checked against DOT VSL guidance, EPA’s 2023 greenhouse-gas report, OMB Circular A-4 materials, EPA’s 2025 SCC reconsideration announcement, HHS ASPE standard values, and USDA ERS VSL tables.
SOURCE QUESTIONS
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WHY THIS MATTERS
For the economist
A structural claim about when bilateral optimization degrades the shared system. Read the formal statement and its stated axioms.
For the regulator
The constraint is physical or biological, so disclosure alone will not internalize it. The policy lever is to bound exposure, not to price it away.
For the executive
This is where a privately efficient decision can degrade the system the business depends on. The governance question is which decision records would make that system cost visible before it is normalized.
For the teacher
An on-site HTML deck and the expanded curriculum cover the argument, the evidence, and the measurement. Use the deck as a self-contained class session, then route deeper through the 45-50h core course or 100+h full curriculum.
For the affected community
In plain terms: who gains from the current arrangement, who pays for it, and what rule change would alter that split. The summary states each without jargon.
© 2026 Erik Postnieks · Independent Researcher · Salt Lake City