A Closed-Form Solution to Stollery’s Problem with Damage in Utility

Бажанов, Андрей

doi:10.1007/s10614-010-9249-4

Cited by 6 publications

(5 citation statements)

References 24 publications

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“…It is worthwhile to note that the influence of D on U is presumed in our study. The assumption of damage on an individual's utility is commonly seen in literature on the environment and resource (See, Bazhanov, 2012 ). Differently, the influence of COVID-19 deaths, D , on work time t is derived from the Roy's inequalities obtained using the first-order conditions for the representative individual's utility function.…”

Section: Modelmentioning

confidence: 99%

Covid-19 vaccines, rules, deaths, and tourism recovery

Okafor

Yan

2022

Annals of Tourism Research

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Section: Modelmentioning

confidence: 99%

Covid-19 vaccines, rules, deaths, and tourism recovery

Okafor

Yan

2022

Annals of Tourism Research

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“…The theory (e.g. Stollery, 1998;Bazhanov, 2012) suggests that negative side effects from resource use call for further redistribution of extraction from the present to future.…”

Section: Sustainable Extraction and Climate Changementioning

confidence: 99%

Extraction path and sustainability

Бажанов

2022

Resources Policy

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This paper offers an approach to construct a family of extraction paths for nonrenewables that guarantee long-run sustainability of an imperfect economy. A path from this family leads to a monotonic growth of output with a decreasing rate of growth if a sustainability condition holds. Otherwise, the path leads either to a bounded decline or U-shaped path of output. In this sense, the paper extends neoclassical results and provides a bridge between neoclassical and degrowth theories because neoclassical tools are used to quantify degrowth scenarios. The offered path can be incentive-compatible for climate change problems because it reduces the extraction of polluting minerals consistently with the IPCC goals. That is, the climate-benefiting emission cuts by the parties of climate agreements may be guided by purely "egoistic" motives-to make own economies long-run sustainable.) is less than one. Then where is a magic trick?Recall that Hartwick (2003) stated that "This result is local in time" and the production function must be "with substitutability among inputs." 8 An example below illustrates general issues 9 reflected in these disclaimers. The example considers a non-optimal economy under (i) and (ii) with the data that are close to real economies. The point of interest is the effect of changes in while other parameters, including the resource-labor and capital-labor substitutabilities, are fixed. Calculations are provided in Appendix A.

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“…Condition (9) shows that, for , 0 < Ψ U the minimum investment G that provides nondeclining utility may be essentially higher than zero. The next section illustrates that a feasible value of , G guaranteeing , 0 ≥ U  may not exist.…”

Section: The Boundedness Of Investments Implies That Ifmentioning

confidence: 99%

“…A particular goal is to show that, under large inefficiencies, 9 increasing investments in man-made or human capital may not help to restore sustainability and even may be harmful, e. g., to poor countries. 12 To illustrate the claims of this study, it is enough to assume that the components of D depend on the extracted amount ) (t X (or on the remaining stock ) (t S ) 13 or on the parameters that express distorted institutions.…”

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confidence: 99%

Inefficiency and sustainability

Бажанов

2015

Resources Policy

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This paper examines the effects of ignored inefficiencies on the reliability of sustainability indicators and effectiveness of investment in resource-based economies. A model of a social planner does not include some phenomena that may influence the path of utility. These unspecified phenomena may cause inefficiency of the economy. In order to simulate this natural discrepancy between theory and real life, this study assumes that the planner applies the policies developed for an efficient (undistorted) model, whereas the real economy is distorted by some neglected effects that can influence utility, production, the balance equation, and the dynamics of the natural reserve. The resulting inefficiency affects the dependence of current utility change on investment. The analysis shows that, for sustainability in the presence of inefficiency, first, changes in institutions and in the patterns of resource extraction may become more important than investments; and secondly, it is preferable to underextract a natural resource under uncertainties in production possibilities and damages from economic activities.An inadequate accounting system, misestimated production possibilities, and insecure property rights are considered as examples of disregarded inefficiencies.

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A Closed-Form Solution to Stollery’s Problem with Damage in Utility

Cited by 6 publications

References 24 publications

Covid-19 vaccines, rules, deaths, and tourism recovery

Covid-19 vaccines, rules, deaths, and tourism recovery

Extraction path and sustainability

Inefficiency and sustainability

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