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Sustainabilty in Closed and Open Economies

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  • Klepper, Gernot
  • Stahler, Frank

Abstract

This paper discusses unilateral sustainability policies for tradable resources in closed and open economies. The effects of sustainability policies are modeled in an intertemporal, competitive framework by applying different sustainability rules which are introduced unilaterally in the domestic country. The paper shows that no sustainability rule will lead to a slower rate of extraction of the resource. Unilateral policies will lead to an "import of sustainability." It is also shown that the foreign country may well gain in terms of consumption and real income from such unilateral sustainability policies but not in terms of sustainability. Copyright 1998 by Blackwell Publishing Ltd.

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  • Klepper, Gernot & Stahler, Frank, 1998. "Sustainabilty in Closed and Open Economies," Review of International Economics, Wiley Blackwell, vol. 6(3), pages 488-506, August.
    • Handle: RePEc:bla:reviec:v:6:y:1998:i:3:p:488-506
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    1. Joseph E. Stiglitz, 1974. "Growth with Exhaustible Natural Resources: The Competitive Economy," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 41(5), pages 139-152.
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    9. Hartwick, John M, 1977. "Intergenerational Equity and the Investing of Rents from Exhaustible Resources," American Economic Review, American Economic Association, vol. 67(5), pages 972-974, December.
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    11. Pearce, David W. & Atkinson, Giles D., 1993. "Capital theory and the measurement of sustainable development: an indicator of "weak" sustainability," Ecological Economics, Elsevier, vol. 8(2), pages 103-108, October.
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    Cited by:

    1. Louis Dupuy & Matthew Agarwala, 2014. "International trade and sustainable development," Chapters, in: Giles Atkinson & Simon Dietz & Eric Neumayer & Matthew Agarwala (ed.), Handbook of Sustainable Development, chapter 25, pages 399-417, Edward Elgar Publishing.
    2. Klepper, Gernot & Stähler, Frank, 1996. "The international dimension of sustainability policies," Kiel Working Papers 754, Kiel Institute for the World Economy (IfW Kiel).
    3. Atkinson, G. & Hamilton, K., 2002. "International trade and the 'ecological balance of payments'," Resources Policy, Elsevier, vol. 28(1-2), pages 27-37.
    4. Harris, Michael & Fraser, Iain, 2002. "Natural resource accounting in theory and practice: A critical assessment," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 46(2), pages 1-54.

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