Advanced Search
MyIDEAS: Login

Intergenerational Conflicts and the Resource Policy Formation of a Short-Lived Government

Contents:

Author Info

  • Uk Hwang
  • Francesco Magris

Abstract

This paper studies the political economy of resource management in an OLG framework with an intertemporal externality problem. The externality arises because a common resource used for production is depleted by production of "dirty" goods. An intergenerational conflict arises because the young generation cares about the level of current production of dirty goods. This is so because production of dirty goods affects the future availability of the resource. The old, on the other hand, has no such a concern. We assume that they lobby the government to affect the policy choice - an upper limit on the resource use allowed for production of dirty goods - in their favour. Within a dynamic common agency framework, we study stationary equilibria focussing on a particular class of strategies which we called "Take It or Leave It"(TIOLI) strategies, where a lobby makes a positive contribution only when her payoff maximising policy is implemented. It is shown that political competition may lead to a "greener" environment policy and to less resource exploitation than in an unregulated economy. More surprisingly, we also find that resource exploitation may be lower in political equilibrium than in an economy run by a social planner.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
File URL: http://www.sjes.ch/papers/2005-III-6.pdf
Download Restriction: no

Bibliographic Info

Article provided by Swiss Society of Economics and Statistics (SSES) in its journal Swiss Journal of Economics and Statistics.

Volume (Year): 141 (2005)
Issue (Month): III (September)
Pages: 437-457

as in new window
Handle: RePEc:ses:arsjes:2005-iii-6

Contact details of provider:
Postal: c/o SNB/BNS, B├Ârsenstrasse 15, PO Box 2800, CH-8022 Z├╝rich
Phone: +41 (0)44 631 32 34
Fax: +41 (0)44 631 39 01
Email:
Web page: http://www.sjes.ch
More information through EDIRC

Related research

Keywords: dynamic common agency; efficiency; externalities; political competition; resource policy design;

Find related papers by JEL classification:

References

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
as in new window
  1. Georg Kirchsteiger & Andrea Prat, 2001. "Inefficient equilibria in lobbying," ULB Institutional Repository 2013/5901, ULB -- Universite Libre de Bruxelles.
  2. Howarth, Richard B., 1991. "Intertemporal equilibria and exhaustible resources: an overlapping generations approach," Ecological Economics, Elsevier, vol. 4(3), pages 237-252, December.
  3. Howarth, Richard B, 1998. " An Overlapping Generations Model of Climate-Economy Interactions," Scandinavian Journal of Economics, Wiley Blackwell, vol. 100(3), pages 575-91, September.
  4. Grossman, Gene & Helpman, Elhanan, 1993. "Protection for Sale," CEPR Discussion Papers 827, C.E.P.R. Discussion Papers.
  5. Dirk Bergemann & Juuso Valimaki, 1998. "Dynamic Common Agency," Discussion Papers 1259, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
  6. Howarth, Richard B & Norgaard, Richard B, 1992. "Environmental Valuation under Sustainable Development," American Economic Review, American Economic Association, vol. 82(2), pages 473-77, May.
  7. Bernheim, B Douglas & Whinston, Michael D, 1986. "Common Agency," Econometrica, Econometric Society, vol. 54(4), pages 923-42, July.
  8. Richard B. Howarth, 1996. "Climate Change And Overlapping Generations," Contemporary Economic Policy, Western Economic Association International, vol. 14(4), pages 100-111, October.
  9. Grossman,G.M. & Helpman,E., 1996. "Intergenerational Redistribution with Short-Lived Governements," Papers 2-96, Tel Aviv.
  10. Richard Howarth & Richard Norgaard, 1993. "Intergenerational transfers and the social discount rate," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 3(4), pages 337-358, August.
  11. Fredriksson, Per G., 1997. "The Political Economy of Pollution Taxes in a Small Open Economy," Journal of Environmental Economics and Management, Elsevier, vol. 33(1), pages 44-58, May.
Full references (including those not matched with items on IDEAS)

Citations

Lists

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Statistics

Access and download statistics

Corrections

When requesting a correction, please mention this item's handle: RePEc:ses:arsjes:2005-iii-6. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Peter Steiner).

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.