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Optimal recycling under heterogeneous waste sources and the environmental Kuznets curve

Author

Listed:
  • Fouad El Ouardighi

    (Operation management Department - Essec Business School)

  • Konstantin Kogan

    () (Bar-Ilan University [Israël])

  • Raouf Boucekkine

    () (GREQAM - Groupement de Recherche en Économie Quantitative d'Aix-Marseille - ECM - Ecole Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique - AMU - Aix Marseille Université - EHESS - École des hautes études en sciences sociales)

Abstract

We investigate how the relationship between economic growth and pollution is affected by the source of pollution: production or consumption. We are interested in polluting waste that cannot be naturally absorbed, but for which recycling efforts aim to avoid massive pollution accumulation with harmful consequences in the long run. We distinguish the cases where recycling efforts are capital-improving or capital-neutral. Based on both environmental and social welfare perspectives, we determine how the interaction between growth and polluting waste accumulation is affected by the source of pollution, i.e., either consumption or production, and by the fact that recycling may or may not act as an income generator, i.e., either capital-improving or capital-neutral recycling efforts. Several new results are extracted regarding optimal recycling policy and the Environmental Kuznets Curve. Beside the latter concern, we show both analytically and numerically that the optimal control of waste through recycling allows to reaching larger (resp., lower) consumption and capital stock levels under consumption-based waste compared to production-based waste while the latter permits to reach lower stocks of waste through lower recycling efforts.

Suggested Citation

  • Fouad El Ouardighi & Konstantin Kogan & Raouf Boucekkine, 2017. "Optimal recycling under heterogeneous waste sources and the environmental Kuznets curve," Working Papers hal-01693488, HAL.
  • Handle: RePEc:hal:wpaper:hal-01693488
    Note: View the original document on HAL open archive server: https://hal-essec.archives-ouvertes.fr/hal-01693488
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    References listed on IDEAS

    as
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    Keywords

    Economic growth; Capital; Consumption; Polluting waste; recycling efforts JEL Classification Q57; C61;

    JEL classification:

    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • Q57 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Ecological Economics

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