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Towards sustainable lignite consumption in Turkey and a welfare analysis

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  • Olfa Jaballi

    ()
    (EUREQua)

  • Sebnem Sahin

    ()
    (EUREQua & OECD)

Abstract

Sustainable consumption is at the center of sustainable development that every country seems to want. One of the great challenges of this century must be to understand what drives the consumption and how we can reduce consumption through increased efficiency. However consumption is not simply determined by population growth, which is commonly assumed to be a key cause of unsustainable consumption, but also by economic activity, technology choices, social values, institutions and policies. In this paper, we focus our analysis on lignite consumption in Turkey as an exhaustible natural resource and we assume that the consumption is only the ultimate end of the economic activity. Some improvements of the Weitzman model (1976) are proposed by introducing an environmental preference parameter into the model to complement his interpretation of welfare. Our aim is to pass from theory to practical applications by presenting some modest empirical results. Our model is constructed under GAMS for the period 1980-2080 using Turkish data and leads to the interesting result that an environmental taxation policy can lead to a social welfare increase in Turkey.

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Bibliographic Info

Paper provided by Université Panthéon-Sorbonne (Paris 1) in its series Cahiers de la Maison des Sciences Economiques with number v05039.

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Length: 20 pages
Date of creation: Apr 2005
Date of revision:
Handle: RePEc:mse:wpsorb:v05039

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Keywords: Dynamic welfare; exhaustible resource; sustainable consumption.;

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  1. M. L. Weitzman, 1974. "On the Welfare Significance of National Product in Dynamic Economy," Working papers 125, Massachusetts Institute of Technology (MIT), Department of Economics.
  2. Asheim, Geir & Buchholz, Wolfgang, 2003. "A General Approach to Welfare Measurement through National Income Accounting," Memorandum 32/2002, Oslo University, Department of Economics.
  3. Asheim, Geir, 2003. "Green national accounting with a changing population," Memorandum 06/2003, Oslo University, Department of Economics.
  4. Hartwick, John M, 1994. " National Wealth and Net National Product," Scandinavian Journal of Economics, Wiley Blackwell, vol. 96(2), pages 253-56.
  5. Krautkraemer, Jeffrey A, 1985. "Optimal Growth, Resource Amenities, and the Preservation of Natural Environments," Review of Economic Studies, Wiley Blackwell, vol. 52(1), pages 153-70, January.
  6. Jonathon M. Harris, . "00-04 "Basic Principles of Sustainable Development."," GDAE Working Papers 00-04, GDAE, Tufts University.
  7. Asheim, Geir B. & Weitzman, Martin L., 2001. "Does NNP growth indicate welfare improvement?," Economics Letters, Elsevier, vol. 73(2), pages 233-239, November.
  8. Solow, Robert, 1993. "An almost practical step toward sustainability," Resources Policy, Elsevier, vol. 19(3), pages 162-172, September.
  9. Jonathan M. Harris, 2001. "Basic Principles of Sustainable Development," Development and Comp Systems 0106006, EconWPA.
  10. Robert Cairns, 2004. "Green Accounting for an Externality, Pollution at a Mine," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 27(4), pages 409-427, April.
  11. Heal, G., 1998. "Valuing the Future: Economic Theory and Sustainability," Papers 98-10, Columbia - Graduate School of Business.
  12. Bergh, Jeroen C.J.M. van den & Ferrer-i-Carbonell, Ada, 1999. "Economic theories of sustainable consumption," Serie Research Memoranda 0055, VU University Amsterdam, Faculty of Economics, Business Administration and Econometrics.
  13. Ayong Le Kama, Alain D., 2001. "Sustainable growth, renewable resources and pollution," Journal of Economic Dynamics and Control, Elsevier, vol. 25(12), pages 1911-1918, December.
  14. Kenneth Arrow & Partha Dasgupta & Lawrence Goulder & Gretchen Daily & Paul Ehrlich & Geoffrey Heal & Simon Levin & Karl-Göran Mäler & Stephen Schneider & David Starrett & Brian Walker, 2004. "Are We Consuming Too Much?," Journal of Economic Perspectives, American Economic Association, vol. 18(3), pages 147-172, Summer.
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