IDEAS home Printed from https://ideas.repec.org/p/hal/journl/hal-00862922.html
   My bibliography  Save this paper

Growth and Irreversible Pollution: Are Emission Permits a Means of Avoiding Environmental and Poverty Traps?

Author

Listed:
  • Fabien Prieur

    (LAMETA - Laboratoire Montpelliérain d'Économie Théorique et Appliquée - UM1 - Université Montpellier 1 - UPVM - Université Paul-Valéry - Montpellier 3 - INRA - Institut National de la Recherche Agronomique - Montpellier SupAgro - Centre international d'études supérieures en sciences agronomiques - UM - Université de Montpellier - CNRS - Centre National de la Recherche Scientifique - Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier)

  • Alain Jean-Marie

    (MAESTRO - Models for the performance analysis and the control of networks - CRISAM - Inria Sophia Antipolis - Méditerranée - Inria - Institut National de Recherche en Informatique et en Automatique, LIRMM - Laboratoire d'Informatique de Robotique et de Microélectronique de Montpellier - UM - Université de Montpellier - CNRS - Centre National de la Recherche Scientifique)

  • Mabel Tidball

    (LAMETA - Laboratoire Montpelliérain d'Économie Théorique et Appliquée - UM1 - Université Montpellier 1 - UPVM - Université Paul-Valéry - Montpellier 3 - INRA - Institut National de la Recherche Agronomique - Montpellier SupAgro - Centre international d'études supérieures en sciences agronomiques - UM - Université de Montpellier - CNRS - Centre National de la Recherche Scientifique - Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier)

Abstract

We consider an OLG model with emissions arising from production and potentially irreversible pollution. Pollution control consists of the assignment of permits to firms; private agents also can abate pollution. In this setting, we prove that multiple equilibria exist. Due to the possible irreversibility of pollution, the economy can be dragged into both environmental and poverty traps. First, we show that choosing an emission quota at the lowest level beyond a critical threshold is a means to avoid these two types of traps. We also prove that when the agents do not engage in maintenance, a reduction of the quota leads to a reduction in pollution but also to slower capital accumulation. In contrast, when agents do engage in maintenance, a reduction of the quota provides a double dividend.

Suggested Citation

  • Fabien Prieur & Alain Jean-Marie & Mabel Tidball, 2013. "Growth and Irreversible Pollution: Are Emission Permits a Means of Avoiding Environmental and Poverty Traps?," Post-Print hal-00862922, HAL.
    • Handle: RePEc:hal:journl:hal-00862922
    DOI: 10.1017/s1365100511000113
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Other versions of this item:

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Sichao Wei & David Aadland, 2021. "Pollution permits, green taxes, and the environmental poverty trap," Review of Development Economics, Wiley Blackwell, vol. 25(2), pages 1032-1052, May.
    2. Alexander Golub & Michael Toman, 2016. "Climate Change, Industrial Transformation, and “Environmental Growth Traps”," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 63(2), pages 249-263, February.
    3. Hiroshi Danbara, 2013. "Environmental Externality on Production in an OLG Economy," Keio/Kyoto Joint Global COE Discussion Paper Series 2012-045, Keio/Kyoto Joint Global COE Program.
    4. Golub, Alexander & Toman, Michael, 2014. "Climate change, industrial transformation, and"development traps"," Policy Research Working Paper Series 6951, The World Bank.

    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:hal:journl:hal-00862922. See general information about how to correct material in RePEc.

    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.

    We have no bibliographic references for this item. You can help adding them by using 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.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: CCSD (email available below). General contact details of provider: https://hal.archives-ouvertes.fr/ .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.