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Endogenous fluctuations induced by nonlinear pollution accumulation in an OLG economy and the bifurcation control


  • Cao, Dong
  • Wang, Lin
  • Wang, Yaozhong


This paper aims to study the influence of nonlinear pollution accumulation on economic growth by incorporating the nonlinear pollution accumulation into an OLG model. It is shown that the nonlinearity can yield very complex dynamics, including the flip bifurcation resulting in sustained fluctuations in economy. This indicates that the nonlinear pollution accumulation can be a source of intergenerational inequity. To stabilize the complex motion and thus to control the fluctuations, a bifurcation control method from control theory is proposed. The welfare analysis shows the sustainable development criterion can be met in the controlled system but not in the original system.

Suggested Citation

  • Cao, Dong & Wang, Lin & Wang, Yaozhong, 2011. "Endogenous fluctuations induced by nonlinear pollution accumulation in an OLG economy and the bifurcation control," Economic Modelling, Elsevier, vol. 28(6), pages 2528-2531.
  • Handle: RePEc:eee:ecmode:v:28:y:2011:i:6:p:2528-2531 DOI: 10.1016/j.econmod.2011.07.016

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    References listed on IDEAS

    1. Gene M. Grossman & Alan B. Krueger, 1995. "Economic Growth and the Environment," The Quarterly Journal of Economics, Oxford University Press, vol. 110(2), pages 353-377.
    2. Schumacher, Ingmar & Zou, Benteng, 2008. "Pollution perception: A challenge for intergenerational equity," Journal of Environmental Economics and Management, Elsevier, vol. 55(3), pages 296-309, May.
    3. Arrow, Kenneth & Bolin, Bert & Costanza, Robert & Dasgupta, Partha & Folke, Carl & Holling, C.S. & Jansson, Bengt-Owe & Levin, Simon & Mäler, Karl-Göran & Perrings, Charles & Pimentel, David, 1996. "Economic growth, carrying capacity, and the environment," Environment and Development Economics, Cambridge University Press, vol. 1(01), pages 104-110, February.
    4. Seegmuller, Thomas & Verchere, Alban, 2004. "Pollution as a source of endogenous fluctuations and periodic welfare inequality in OLG economies," Economics Letters, Elsevier, vol. 84(3), pages 363-369, September.
    5. Jouvet, Pierre-Andre & Michel, Philippe & Rotillon, Gilles, 2005. "Optimal growth with pollution: how to use pollution permits?," Journal of Economic Dynamics and Control, Elsevier, vol. 29(9), pages 1597-1609, September.
    6. Krishna Paudel & Mark Schafer, 2009. "The Environmental Kuznets Curve Under a New Framework: The Role of Social Capital in Water Pollution," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 42(2), pages 265-278, February.
    7. Jean-Paul Chavas, 2004. "On Impatience, Economic Growth and the Environmental Kuznets Curve: A Dynamic Analysis of Resource Management," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 28(2), pages 123-152, June.
    8. Dinda, Soumyananda, 2004. "Environmental Kuznets Curve Hypothesis: A Survey," Ecological Economics, Elsevier, vol. 49(4), pages 431-455, August.
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    Cited by:

    1. Wang, Sophie Xuefei & Fu, Yu Benjamin & Zhang, Zhe George, 2015. "Population growth and the environmental Kuznets curve," China Economic Review, Elsevier, vol. 36(C), pages 146-165.
    2. repec:gam:jsusta:v:9:y:2017:i:5:p:746-:d:97515 is not listed on IDEAS

    More about this item


    Flip bifurcation; Nonlinear pollution accumulation; OLG model; Delayed feedback control;

    JEL classification:

    • E6 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook
    • O0 - Economic Development, Innovation, Technological Change, and Growth - - General


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