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Environmental tax reform in an overlapping-generations economy with involuntary unemployment

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  • Tetsuo Ono

Abstract

This report presents an overlapping-generations model in which (1) pollution is generated as a by-product of capital, and (2) employment is rationed by monopolistic trade unions. We consider an environmental tax reform, consisting of a labor tax cut and the introduction of an environmental tax, and investigate whether the reform attains improvements of employment, environmental quality, and the nonenvironmental utility of the employed and the unemployed. It is shown that the reform attains the improvements within a generation but fails to attain them across generations. The reform yields a trade-off between current and future generations in terms of nonenvironmental utility. Copyright Springer Japan 2008

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  • Tetsuo Ono, 2008. "Environmental tax reform in an overlapping-generations economy with involuntary unemployment," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 9(4), pages 213-238, December.
    • Handle: RePEc:spr:envpol:v:9:y:2008:i:4:p:213-238
    DOI: 10.1007/BF03354009
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    Cited by:

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    3. De Gobbi, Maria Sabrina., 2011. "Mainstreaming environmental issues in sustainable enterprises : an exploration of issues, experiences and options," ILO Working Papers 994620973402676, International Labour Organization.

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