Infinite Horizon Analysis

Definition

The mathematical framework for evaluating capital over perpetual time horizons. For regenerative capital with R > 0, system value approaches infinity as time extends, unlike terminal grants which have fixed finite value.

Formula

As N → ∞: TSV → γC₀/(1-R) when R < 1

Example

A $100K PSC fund with R=0.9 and γ=1.2 approaches $1.2M in perpetual system value, compared to $120K for a one-time grant.

Source

RCT Section 4.4

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Related Terms from Regenerative Capital Theory

Regenerative Capital

Extractive vs Regenerative Logic

Four Capital Classes

Capital Productivity (λ)λ (lambda)

System Capacity

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Regenerative Capital Theory