Sustainable Growth and the Green Golden Rule
We study a growth model with an environmental asset which is a source of utility and an input to consumption and production. The stock of this asset follows its own ecological dynamics, which are affected by economic activity. We study the implications of an approach to ranking sequences of consumption and environment over time that place weight both on the characteristics of the sequence over any finite period and on its very long run or limiting characteristics. Chichilnisky  has called these "sustainable preferences". The criterion shows more intertemporal symmetry than the discounted utilitarian approach. which clearly emphasizes the immediate future at the expense of the long run. In this respect Chichilniskys criterion captures some of the concerns of those who argue for sustainability and for a heightened sense of responsibility to the future. To characterize optimal paths we define the "green golden rule", the path which maximizes long-run sustainable utility from consumption and environment.
|Date of creation:||Aug 1993|
|Publication status:||Published as "The Green Golden Rule", EL, Vol. 49, no. 2 (1995): 175-179.|
|Contact details of provider:|| Postal: National Bureau of Economic Research, 1050 Massachusetts Avenue Cambridge, MA 02138, U.S.A.|
Web page: http://www.nber.org
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Heal, Geoffrey M., 1993. "The optimal use of exhaustible resources," Handbook of Natural Resource and Energy Economics,in: A. V. Kneese† & J. L. Sweeney (ed.), Handbook of Natural Resource and Energy Economics, edition 1, volume 3, chapter 18, pages 855-880 Elsevier.
- Wilen, James E., 1985. "Bioeconomics of renewable resource use," Handbook of Natural Resource and Energy Economics,in: A. V. Kneese† & J. L. Sweeney (ed.), Handbook of Natural Resource and Energy Economics, edition 1, volume 1, chapter 2, pages 61-124 Elsevier.
- Martin L. Weitzman, 1976.
"On the Welfare Significance of National Product in a Dynamic Economy,"
The Quarterly Journal of Economics,
Oxford University Press, vol. 90(1), pages 156-162.
- M. L. Weitzman, 1974. "On the Welfare Significance of National Product in Dynamic Economy," Working papers 125, Massachusetts Institute of Technology (MIT), Department of Economics.
- William R. Cline, 1992. "Economics of Global Warming, The," Peterson Institute Press: All Books, Peterson Institute for International Economics, number 39.
- J. E. Meade, 1962. "The Effect of Savings on Consumption in a State of Steady Growth," Review of Economic Studies, Oxford University Press, vol. 29(3), pages 227-234.
- Lauwers, Luc, 1993. "Infinite Chichilnisky rules," Economics Letters, Elsevier, vol. 42(4), pages 349-352.
- Partha Dasgupta & Geoffrey Heal & Joseph E. Stiflitx, 1980. "The Taxation of Exhaustible Resources," NBER Working Papers 0436, National Bureau of Economic Research, Inc.
- Chichilnisky Graciela & Heal Geoffrey M., 1993. "Competitive Equilibrium in Sobolev Spaces without Bounds on Short Sales," Journal of Economic Theory, Elsevier, vol. 59(2), pages 364-384, April.
- Dutta, Prajit K., 1991. "What do discounted optima converge to?: A theory of discount rate asymptotics in economic models," Journal of Economic Theory, Elsevier, vol. 55(1), pages 64-94, October.
- R. M. Solow, 1974.
"Intergenerational Equity and Exhaustible Resources,"
Review of Economic Studies,
Oxford University Press, vol. 41(5), pages 29-45.
- R. M. Solow, 1973. "Intergenerational Equity and Exhaustable Resources," Working papers 103, Massachusetts Institute of Technology (MIT), Department of Economics.
- Chichilnisky, Graciela, 1980. "Social choice and the topology of spaces of preferences," MPRA Paper 8006, University Library of Munich, Germany.
- Dutta, P.K., 1991. "What Do Discounted Optima Converge To? A Theory of Discount Rate Asymptotics in Economic Models," RCER Working Papers 264, University of Rochester - Center for Economic Research (RCER).
- Solow, Robert, 1993. "An almost practical step toward sustainability," Resources Policy, Elsevier, vol. 19(3), pages 162-172, September.
When requesting a correction, please mention this item's handle: RePEc:nbr:nberwo:4430. 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: ()
If references are entirely missing, you can add them using this form.