Dynamic Inefficiency in an Overlapping Generation Economy with Pollution and Health Costs

Gutiérrez, María-José

doi:10.1111/j.1467-9779.2008.00377.x

Cited by 49 publications

(58 citation statements)

References 34 publications

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“…This is what actually eliminates the possibility of endogenous cycles in our model. For a similar assumption on health costs being incurred during old adulthood, see Gutiérrez (2008).…”

mentioning

confidence: 99%

Endogenous fertility in a growth model with public and private health expenditures

Varvarigos

Zakaria

2012

J Popul Econ

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We build an overlapping generations model with endogenous fertility choices as well as public and private expenditures on health. We find that the complementary effect of public health services on private health expenditures can provide an additional explanation behind a salient feature of demographic transition; that is, the fertility decline along the process of economic growth. JEL classification: J13, O41

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“…This is what actually eliminates the possibility of endogenous cycles in our model. For a similar assumption on health costs being incurred during old adulthood, see Gutiérrez (2008).…”

mentioning

confidence: 99%

Endogenous fertility in a growth model with public and private health expenditures

Varvarigos

Zakaria

2012

J Popul Econ

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“…Note that the nonlinear map G is not explicitly given, but is rather defined implicitly by (13); it is very difficult to analyze the dynamics of the map G analytically. In this section, we numerically explore the emergence of complex dynamics.…”

Section: Complex Dynamicsmentioning

confidence: 99%

“…Equation (13) implicitly defines a nonlinear map, G : R + → R + with k t+1 = G(k t ); that is, for any given k t > 0, there exists a unique k t+1 > 0 that satisfies (13).…”

Section: Equilibrium: Existence and Uniquenessmentioning

confidence: 99%

“…We point out that in optimal economic growth literature, pollution is always considered as an emission and by-product of economic growth, and has a negative effect on the utility agents. Gutierres [13] analyzed the effects that pollution can produce on the economy when it affects the health of agents who are forced to spend on medical care when they are elderly. Most of the existing literature focuses on the emission effect of economic growth.…”

Section: Introductionmentioning

confidence: 99%

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Complex Dynamics Induced by Nonlinear Pollution Absorption, Pollution Emission Rate and Effectiveness of Abatement Technology in an OLG Model

Dong

Wang

2017

Sustainability

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Abstract:In this work, nonlinear pollution absorption, emission rate, and effectiveness of abatement technology are incorporated into the classic overlapping generation model. Within this framework, we analyze the macroeconomic effects of pollution emission and abatement technology on the economy. Our findings reveal that different levels of pollution emission rates from per capita income and the effectiveness of abatement technology could induce complex dynamical behavior, including the occurrence of a stable equilibrium, cycles, and chaos. Our analysis shows that either the pollution emission rate per capita income should be controlled to be small enough or the effectiveness of abatement technology should be large enough to maintain a stable system yielding high level of per capita income. A high level of pollution emission rate per capita income and a low level of effectiveness of abatement technology can lead to a stable economy, but with a low level of per capita income. In the case that the pollution emission rate and the effectiveness of abatement technology vary in a certain range, the economy would become unstable, and cycles and chaos would emerge.

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“…11 Recent studies, such as Pautrel (2008), Gutierrez (2008), Mariani et 9 The literature on environment and growth dates back to Gruver (1976) which studies how pollution affects intertemporal resource allocation and why optimal capital accumulation should be less than that under the traditional golden rule.…”

Section: Introductionmentioning

confidence: 99%

Optimal health and environmental policies in a pollution-growth nexus

Wang

Zhao

Bhattacharya

2015

Journal of Environmental Economics and Management

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This paper shows how policies aimed at insuring health risks and those intended to improve the environment are (and should be) deeply intertwined. In the model economy, inspired by recent Chinese experience, pollution raises the likelihood of poor health in the future prompting agents to self insure against anticipated, rising medical expenses. The increased saving generates more capital while capital use by firms generates more pollution. Along the transition, such a pollution-growth nexus may be attractive from a capital-accumulation perspective; however, rising pollution, via the health channel, definitely hurts welfare. Availability of private health insurance to top up pay-as-you-go coverage of medical bills together with a Pigouvian tax on emissions can replicate the first best. AbstractThis paper shows how policies aimed at insuring health risks and those intended to improve the environment are (and should be) deeply intertwined. In the model economy, inspired by recent Chinese experience, pollution raises the likelihood of poor health in the future prompting agents to self insure against anticipated, rising medical expenses. The increased saving generates more capital while capital use by firms generates more pollution. Along the transition, such a pollution-growth nexus may be attractive from a capital-accumulation perspective; however, rising pollution, via the health channel, definitely hurts welfare. Availability of private health insurance to top up pay-as-you-go coverage of medical bills together with a Pigouvian tax on emissions can replicate the first best.

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Dynamic Inefficiency in an Overlapping Generation Economy with Pollution and Health Costs

Cited by 49 publications

References 34 publications

Endogenous fertility in a growth model with public and private health expenditures

Endogenous fertility in a growth model with public and private health expenditures

Complex Dynamics Induced by Nonlinear Pollution Absorption, Pollution Emission Rate and Effectiveness of Abatement Technology in an OLG Model

Optimal health and environmental policies in a pollution-growth nexus

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