Policies for Sustainability: Lessons from an Overlapping Generations Model
Discounting is often considered inimical to sustainability. Reliance on the assumption that endowments regulate the transfer of assets to the future in standard growth models interprets the interest rate in the intergenerational context as a partial reflection of myopia. A more complete market model that allows agents from different generations to engage in long-term contracts with one another severs the movement of capital to the future from the endowment assumption. Adherence to the endowment assumption as a de facto market structure, not simply a modeling convenience, endorses sustainability policies that injure the future.
When requesting a correction, please mention this item's handle: RePEc:uwp:landec:v:73:y:1997:i:4:p:608-622. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()
If references are entirely missing, you can add them using this form.