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Pollution from consumption and urban unemployment in a dual economy

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  • Azusa Nakamura

    (Gifu Shotoku Gakuen University)

Abstract

By incorporating the environmental problems caused by consumption into a theoretical model of rural–urban migration, this study analyzes the effect of a reduction in pollution generation rate and factor accumulation. The environment of each rural and urban area is assumed to deteriorate due to pollution from consumption of the respective inhabitants. For institutional reasons, the urban wage rate is fixed at a higher level than the rural wage rate, and unemployment exists in the urban area. Rural–urban migration occurs because of differences in utility, which is affected by both the environment and expected earning in each area. This study shows that, although reduction in the pollution generation rate improves the environment in both areas, whether it mitigates urban unemployment depends on certain conditions. Regarding the effect of factor accumulation, this study shows that an increase in capital endowment decreases the level of unemployment if and only if the environmental effect outweighs the Rybczynski effect.

Suggested Citation

  • Azusa Nakamura, 2018. "Pollution from consumption and urban unemployment in a dual economy," Asia-Pacific Journal of Regional Science, Springer, vol. 2(1), pages 211-226, April.
    • Handle: RePEc:spr:apjors:v:2:y:2018:i:1:d:10.1007_s41685-018-0071-7
    DOI: 10.1007/s41685-018-0071-7
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    References listed on IDEAS

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    Cited by:

    1. Azusa Nakamura, 2020. "Environmental disparities in an urban area, rural–urban migration, and urban unemployment," Asia-Pacific Journal of Regional Science, Springer, vol. 4(2), pages 463-477, June.
    2. Moriki Hosoe, 2018. "Special issue (part II) on economic analysis of law, politics, and regions," Asia-Pacific Journal of Regional Science, Springer, vol. 2(1), pages 79-82, April.

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    More about this item

    Keywords

    Environment; Pollution from consumption; Rural–urban migration; Urban unemployment;
    All these keywords.

    JEL classification:

    • J64 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Unemployment: Models, Duration, Incidence, and Job Search
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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