IDEAS home Printed from https://ideas.repec.org/p/cns/cnscwp/201230.html
   My bibliography  Save this paper

Global Indeterminacy in a Tourism Sector Model

Author

Listed:
  • OA Carboni

    ()

  • P. Russu

Abstract

This article develops a dynamic optimising macro model of a open economy specialised in tourism based on natural resources. Environmental externalities are explicitly introduced in the production function. Global dynamic analysis shows that, under some conditions on the parameters, if the initial values of the state variables are close enough to the coordinates of Pa, then there exists a continuum of equilibrium trajectories approaching Pa and one trajectory approaching Pb. Therefore, the model exhibits global indeterminacy, since either Pa or Pb can be selected according to agent expectations.

Suggested Citation

  • OA Carboni & P. Russu, 2012. "Global Indeterminacy in a Tourism Sector Model," Working Paper CRENoS 201230, Centre for North South Economic Research, University of Cagliari and Sassari, Sardinia.
  • Handle: RePEc:cns:cnscwp:201230
    as

    Download full text from publisher

    File URL: http://crenos.unica.it/crenos/node/3824
    Download Restriction: no

    File URL: http://crenos.unica.it/crenos/sites/default/files/WP12-30.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Eliasson, Ludvik & Turnovsky, Stephen J., 2004. "Renewable resources in an endogenously growing economy: balanced growth and transitional dynamics," Journal of Environmental Economics and Management, Elsevier, vol. 48(3), pages 1018-1049, November.
    2. Antoci, Angelo & Galeotti, Marcello & Russu, Paolo, 2011. "Poverty trap and global indeterminacy in a growth model with open-access natural resources," Journal of Economic Theory, Elsevier, vol. 146(2), pages 569-591, March.
    3. Kiminori Matsuyama, 1991. "Increasing Returns, Industrialization, and Indeterminacy of Equilibrium," The Quarterly Journal of Economics, Oxford University Press, vol. 106(2), pages 617-650.
    4. Gardner Brown, 2000. "Renewable Natural Resource Management and Use Without Markets," Working Papers 0025, University of Washington, Department of Economics.
    5. Damania, Richard & Hatch, John, 2005. "Protecting Eden: markets or government?," Ecological Economics, Elsevier, vol. 53(3), pages 339-351, May.
    6. Gardner Brown, 2000. "Renewable Natural Resource Management and Use Without Markets," Discussion Papers in Economics at the University of Washington 0025, Department of Economics at the University of Washington.
    7. Paul Krugman, 1991. "History versus Expectations," The Quarterly Journal of Economics, Oxford University Press, vol. 106(2), pages 651-667.
    8. Angelo Antoci & Marcello Galeotti & Paolo Russu, 2014. "Global analysis and indeterminacy in a two-sector growth model with human capital," International Journal of Economic Theory, The International Society for Economic Theory, vol. 10(4), pages 313-338, December.
    9. Gardner M. Brown, 2000. "Renewable Natural Resource Management and Use without Markets," Journal of Economic Literature, American Economic Association, vol. 38(4), pages 875-914, December.
    10. Carboni, Oliviero A. & Russu, Paolo, 2013. "Linear production function, externalities and indeterminacy in a capital-resource growth model," Journal of Mathematical Economics, Elsevier, vol. 49(5), pages 422-428.
    11. Antoci, Angelo & Galeotti, Marcello & Russu, Paolo, 2005. "Consumption of private goods as substitutes for environmental goods in an economic growth model," MPRA Paper 13664, University Library of Munich, Germany.
    12. Antoci, Angelo & Sodini, Mauro, 2009. "Indeterminacy, bifurcations and chaos in an overlapping generations model with negative environmental externalities," MPRA Paper 13750, University Library of Munich, Germany.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    global and local indeterminacy; environmental externalities; history versus expectations; hopf bifurcation;

    JEL classification:

    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • C62 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Existence and Stability Conditions of Equilibrium
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
    • Q22 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Fishery

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cns:cnscwp:201230. 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: (Antonello Pau). General contact details of provider: http://edirc.repec.org/data/crenoit.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.