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Environmental Preservation, Sectoral Unemployment, and Trade in Resources

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  • Chao, Chi-Chur
  • Kerkvliet, Joe R
  • Yu, Eden S H

Abstract

This paper develops a general equilibrium model to examine the optimal level of environmental preservation in terms of its costs and benefits for a closed as well as an open economy. The optimal preservation policy for a closed economy is to tax the general population and use the tax revenue to compensate affected workers. Furthermore, for a small open economy, free trade in resources can meet whatever shortage of domestic productive resources that may occur, thereby leading to a higher optimal level of environmental preservation. Copyright 2000 by Blackwell Publishing Ltd

Suggested Citation

  • Chao, Chi-Chur & Kerkvliet, Joe R & Yu, Eden S H, 2000. "Environmental Preservation, Sectoral Unemployment, and Trade in Resources," Review of Development Economics, Wiley Blackwell, vol. 4(1), pages 39-50, February.
  • Handle: RePEc:bla:rdevec:v:4:y:2000:i:1:p:39-50
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    References listed on IDEAS

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    1. Galor, Oded & Ryder, Harl E., 1989. "Existence, uniqueness, and stability of equilibrium in an overlapping-generations model with productive capital," Journal of Economic Theory, Elsevier, pages 360-375.
    2. Galor, Oded, 1992. "A Two-Sector Overlapping-Generations Model: A Global Characterization of the Dynamical System," Econometrica, Econometric Society, vol. 60(6), pages 1351-1386, November.
    3. Cremers, Emily T., 1997. "Capital markets and dimension in neoclassical models of growth with trade," Journal of International Economics, Elsevier, pages 155-172.
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    Cited by:

    1. M. Ali Khan, 2007. "The Harris-Todaro Hypothesis," Labor Economics Working Papers 22206, East Asian Bureau of Economic Research.
    2. M. Ali Khan, 2007. "The Harris-Todaro Hypothesis," Labor Economics Working Papers 22206, East Asian Bureau of Economic Research.
    3. Arief Anshory Yusuf, 2005. "Who Pay for the Cleaner Air? Distributional Impact of Environmental Policy in a Dualistic Economy," Working Papers in Economics and Development Studies (WoPEDS) 200502, Department of Economics, Padjadjaran University, revised Feb 2005.
    4. Ichiroh Daitoh & Nori Tarui, 2016. "Open-access Renewable Resources and Urban Unemployment: Dual Institutional Failures in a Small Open Economy," Keio-IES Discussion Paper Series 2016-009, Institute for Economics Studies, Keio University.

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