The social discount rate (SDR) is a critical parameter of investment appraisal and alternative scheme comparison. Through solving stochastic differential equation, a reference formula of measuring the SDR was presented by means of the equivalent return on stock investment and the long-term interest rate. With the data of the main western economies for set by some countries concerned,the SDRs are checked to match the results of the calculation. Such a test proves the feasibility of this approach. In the process of empirical analysis, it is found that there is the quadratic nonlinear regression correlation between the interest rate and the inflation rate, which raises question on the traditional linear rule of determination of the interest rate.

social discount rate(SDR)  /  equivalent return on investment  /  empirical test  /  nonlinear  /  rule of the interest rate