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Life Expectancy and the Environment

  • Mariani, Fabio

    ()

    (Université catholique de Louvain)

  • Pérez-Barahona, Agustín

    ()

    (Ecole Polytechnique, Paris)

  • Raffin, Natacha

    ()

    (University of Paris 1 Panthéon-Sorbonne)

We present an OLG model in which life expectancy and environmental quality dynamics are jointly determined. Agents may invest in environmental care, depending on how much they expect to live. In turn, environmental conditions affect life expectancy. As a result, our model produces a positive correlation between longevity and environmental quality, both in the long-run and along the transition path. Eventually, multiple equilibria may also arise: some countries might be caught in a low-life-expectancy / low-environmental-quality trap. This outcome is consistent with stylized facts relating life expectancy and environmental performance measures. We also discuss the welfare and policy implications of the intergenerational externalities generated by individual choices. Finally, we show that our results are robust to the introduction of growth dynamics based on physical or human capital accumulation.

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Paper provided by Institute for the Study of Labor (IZA) in its series IZA Discussion Papers with number 4564.

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Length: 35 pages
Date of creation: Nov 2009
Date of revision:
Publication status: published in: Journal of Economic Dynamics and Control, 2010, 34 (4), 798-815
Handle: RePEc:iza:izadps:dp4564
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  15. David, DE LA CROIX & Alessandro, SOMMACAL, 2006. "A Theory of Medecine Effectiveness, Differential Mortality, Income Inequality and Growth for Pre-Industrial England," Discussion Papers (ECON - Département des Sciences Economiques) 2006025, Université catholique de Louvain, Département des Sciences Economiques.
  16. David Croix & Davide Dottori, 2008. "Easter Island’s collapse: a tale of a population race," Journal of Economic Growth, Springer, vol. 13(1), pages 27-55, March.
  17. Pierre-André Jouvet & Philippe Michel & Gilles Rotillon, 2004. "Optimal growth with pollution : how to use pollution permits ?," Cahiers de la Maison des Sciences Economiques v04012, Université Panthéon-Sorbonne (Paris 1).
  18. Partha Dasgupta & Karl-Göran Mäler, 2003. "The Economics of Non-Convex Ecosystems: Introduction," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 26(4), pages 499-525, December.
  19. Yoram Ben-Porath, 1967. "The Production of Human Capital and the Life Cycle of Earnings," Journal of Political Economy, University of Chicago Press, vol. 75, pages 352.
  20. Chichilnisky, Graciela & Heal, Geoffrey & Beltratti, Andrea, 1995. "The Green Golden Rule," Economics Letters, Elsevier, vol. 49(2), pages 175-179, August.
  21. Blackburn, Keith & Cipriani, Giam Pietro, 2002. "A model of longevity, fertility and growth," Journal of Economic Dynamics and Control, Elsevier, vol. 26(2), pages 187-204, February.
  22. Evans, Mary F. & Smith, V. Kerry, 2005. "Do new health conditions support mortality-air pollution effects?," Journal of Environmental Economics and Management, Elsevier, vol. 50(3), pages 496-518, November.
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