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Environmental Policy and Sustainable Economic Growth - an endogenous growth perspective

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  • Sjak Smulders

Abstract

This paper investigates the consequences of environmental policy for welfare, consumption and production growth in a situation in which environmental quality is initially too low. The natural environment is corporated in endogenous growth theory in a way that is consistent with some simple notions from the laws of thermodynamics. Environmental policy affects growth, both in the long run and in the short run, by affecting the productivity of investment and the savings behavior of consumers. The environment provides necessary inputs to economic production and accumulation processes. Hence improvements in environmental quality that follow environmental policy may boost the productivity of the environment and growth.

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Bibliographic Info

Paper provided by Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics in its series EPRU Working Paper Series with number 95-07.

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Handle: RePEc:kud:epruwp:95-07

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Cited by:
  1. Ramirez, Donna Theresa J. & Khanna, Madhu & Zilberman, David, 2002. "Conservation Capital And Sustainable Economic Growth," 2002 Annual meeting, July 28-31, Long Beach, CA 19846, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
  2. Smulders, J.A., 1995. "Entropy, environment and endogenous economic growth," Open Access publications from Tilburg University urn:nbn:nl:ui:12-153413, Tilburg University.
  3. Jacobsen, Henrik Klinge, 2001. "Technological progress and long-term energy demand -- a survey of recent approaches and a Danish case," Energy Policy, Elsevier, vol. 29(2), pages 147-157, January.
  4. Smulders, J.A., 1997. "Should Environmental Standards be Tighter if Technological Change is Endogenous?," Discussion Paper 1997-79, Tilburg University, Center for Economic Research.
  5. Michiel Keyzer & Max Merbis & Roelf Voortman, 2008. "The Biofuel Controversy," De Economist, Springer, vol. 156(4), pages 507-527, December.
  6. Dagmar Nelissen & Till Requate, 2007. "Pollution-reducing and resource-saving technological progress," International Journal of Agricultural Resources, Governance and Ecology, Inderscience Enterprises Ltd, vol. 6(1), pages 5-44.
  7. Walid Oueslati, 2013. "Short and Long-term Effects of Environmental Tax Reform," Working Papers 2013.09, Fondazione Eni Enrico Mattei.
  8. Krysiak, Frank C., 2006. "Entropy, limits to growth, and the prospects for weak sustainability," Ecological Economics, Elsevier, vol. 58(1), pages 182-191, June.

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