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Inequality, growth, and environmental quality tradeoffs in a model with human capital accumulation

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  • Marta Aloi
  • Frederic Tournemaine

Abstract

This paper develops a simple endogenous growth model where pollution exposure and vulnerability are unequally spread across the population, and growth and distribution are endogenous. In this setup, we investigate whether tradeoffs between growth, distributional, and environmental concerns may emerge. We show that a tighter environmental policy reduces income inequality and can improve both growth and total welfare. Immediate welfare losses, though, do occur, and are larger for countries that start at low levels of environmental quality (e.g. developing countries).

Suggested Citation

  • Marta Aloi & Frederic Tournemaine, 2013. "Inequality, growth, and environmental quality tradeoffs in a model with human capital accumulation," Canadian Journal of Economics, Canadian Economics Association, vol. 46(3), pages 1123-1155, August.
    • Handle: RePEc:cje:issued:v:46:y:2013:i:3:p:1123-1155
    DOI: 10.1111/caje.12046
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    Cited by:

    1. Constant, Karine & Davin, Marion, 2021. "Pollution, children’s health and the evolution of human capital inequality," Mathematical Social Sciences, Elsevier, vol. 112(C), pages 9-25.
    2. Chang, Juin-Jen & Huang, Chien-Yu & Wong, Chun Yee & Yang, Yibai, 2023. "Environmental regulation stringency and allocation between R&D and physical capital: A two-engine growth model," Journal of Economic Behavior & Organization, Elsevier, vol. 216(C), pages 733-753.
    3. Dimitrios Varvarigos, 2013. "Economic Growth, Health, and the Choice of Polluting Technologies: The Role of Bureaucratic Corruption," Discussion Papers in Economics 13/22, Division of Economics, School of Business, University of Leicester.
    4. Constant, Karine, 2019. "Environmental policy and human capital inequality: A matter of life and death," Journal of Environmental Economics and Management, Elsevier, vol. 97(C), pages 134-157.
    5. Frederic Tournemaine & Christopher Tsoukis, 2018. "The Great Transition: Implications From Environmental Policy For The Quality–Quantity Trade-Off In Children-Rearing," The Singapore Economic Review (SER), World Scientific Publishing Co. Pte. Ltd., vol. 63(05), pages 1155-1174, December.
    6. Alessia Cafferata & Marwil J. Dávila-Fernández, 2024. "How robust is the natalist bias of pollution control?," Annals of Operations Research, Springer, vol. 337(3), pages 1111-1133, June.
    7. Karine Constant & Natacha Raffin, 2016. "Environnement, croissance et inégalités : le rôle particulier du canal de la santé," Revue française d'économie, Presses de Sciences-Po, vol. 0(3), pages 9-29.
    8. Yoshihiro Hamaguchi, 2025. "Agglomeration, inequality, and the environment in an R&D-based growth model," Letters in Spatial and Resource Sciences, Springer, vol. 18(1), pages 1-17, December.
    9. Karine Constant, 2015. "Environmental Policy and Inequality: A Matter of Life and Death," Working Papers halshs-01174052, HAL.
    10. Abbas Valadkhani & Israfil Roshdi & Russell Smyth, 2015. "A multicomponent DEA approach to measure the economic and energy efficiencies of OECD countries," Monash Economics Working Papers 09-15, Monash University, Department of Economics.
    11. Wei, Sichao & Aadland, David, 2026. "Green taxes, the environment, and the economy: A theoretical analysis using an overlapping generations model with endogenous longevity," Economic Modelling, Elsevier, vol. 155(C).

    More about this item

    JEL classification:

    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
    • Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy

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