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Fertility, Mortality and Environmental Policy

Author

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  • Lehmijoki, Ulla

    () (University of Helsinki)

  • Palokangas, Tapio K.

    () (University of Helsinki)

Abstract

This article examines pollution and environmental mortality in an economy where fertility is endogenous and output is produced from labor and capital by two sectors, dirty and clean. An emission tax curbs dirty production, which decreases pollution-induced mortality but also shifts resources to the clean sector. If the dirty sector is more capital intensive, then this shift increases labor demand and wages. This, in turn, raises the opportunity cost of rearing a child, thereby decreasing fertility and the population size. Correspondingly, if the clean sector is more capital intensive, then the emission tax decreases the wage and increases fertility. Although the proportion of the dirty sector in production falls, the expansion of population boosts total pollution, aggravating mortality.

Suggested Citation

  • Lehmijoki, Ulla & Palokangas, Tapio K., 2016. "Fertility, Mortality and Environmental Policy," IZA Discussion Papers 10465, Institute for the Study of Labor (IZA).
  • Handle: RePEc:iza:izadps:dp10465
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    References listed on IDEAS

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    1. Gary S. Becker, 1981. "A Treatise on the Family," NBER Books, National Bureau of Economic Research, Inc, number beck81-1, January.
    2. de la Croix, David & Gosseries, Axel, 2012. "The natalist bias of pollution control," Journal of Environmental Economics and Management, Elsevier, vol. 63(2), pages 271-287.
    3. repec:spr:dymeef:978-3-642-02132-9 is not listed on IDEAS
    4. 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.
    5. Ulla Lehmijoki & Tapio Palokangas, 2009. "Population growth overshooting and trade in developing countries," Journal of Population Economics, Springer;European Society for Population Economics, vol. 22(1), pages 43-56, January.
    6. 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.
    7. Razin, Assaf & Ben-Zion, Uri, 1975. "An Intergenerational Model of Population Growth," American Economic Review, American Economic Association, vol. 65(5), pages 923-933, December.
    8. Wolfgang F. Stolper & Paul A. Samuelson, 1941. "Protection and Real Wages," Review of Economic Studies, Oxford University Press, vol. 9(1), pages 58-73.
    9. Costanza, Robert, 1995. "Economic growth, carrying capacity, and the environment," Ecological Economics, Elsevier, vol. 15(2), pages 89-90, November.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    environmental mortality; pollution tax; population growth; two-sector models;

    JEL classification:

    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

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