Structural change and sustainable development

López, Ramón; Anríquez, Gustavo; Gulati, Sumeet

doi:10.1016/j.jeem.2006.10.003

Cited by 74 publications

(34 citation statements)

References 24 publications

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“…Our function displays a constant intertemporal elasticity of substitution and possesses the property that income and substitution effects exactly balance each other in the labor supply equation. 7 In modeling production activity based on open-access natural resources (for example, fishery, forestry and tourism), the stock E(t) of the environmental resource very often enters as an input in the production function: see, for example, Berck and Perloff [14], Ayong Le Kama [6], López et al [34]. Some authors use the Cobb-Douglas production function introduced by Gordon [26] and Schaefer [47], with all the exponents equal to one (see, e.g., López et al [34]).…”

Section: Set-up Of the Modelmentioning

confidence: 99%

Poverty trap and global indeterminacy in a growth model with open-access natural resources

Antoci

Galeotti

Russu

2011

Journal of Economic Theory

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In this paper we use global analysis techniques to analyze an economic growth model with environmental negative externalities, giving rise to a three-dimensional dynamic system (the framework is the one introduced by Wirl (1997) [53]). The dynamics of our model admits a locally attracting stationary state P * 1 , which is, in fact, a poverty trap, coexisting with another stationary state P * 2 possessing saddle-point stability. Global dynamical analysis shows that, under some conditions on the parameters, if the initial values of the state variables are close enough to the coordinates of P * 1 , then there exists a continuum of equilibrium trajectories approaching P * 1 and one trajectory approaching P * 2 . Therefore, our model exhibits global indeterminacy, since either P * 1 or P * 2 can be selected according to agent expectations. Moreover, we prove that conditions guaranteeing the attractivity of P * 1 also imply the saddle-point stability of P * 2 . However, when P * 1 is not attractive, numerical simulations show the possible existence of one or two limit cycles: an attractive one surrounding P * 1 and one endowed with a two-dimensional stable manifold surrounding P * 2 . © 2010 Elsevier Inc. All rights reserved. Open-access natural resources $ The authors wish to thank Tadashi Shigoka for his precious comments to a preliminary version of the article together with an associate editor and two referees of this journal, whose remarks and suggestions have allowed a substantial improvement of the work.

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Section: Set-up Of the Modelmentioning

confidence: 99%

Poverty trap and global indeterminacy in a growth model with open-access natural resources

Antoci

Galeotti

Russu

2011

Journal of Economic Theory

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“…Due to this endogeneity, policies can affect the speed of resource extraction as well as aggregate research activities -both of which are crucial for the dynamics of the economy. 3 Our approach is also close to papers where heterogeneous sectors cause ongoing structural change, see Kuznets (1957), Kongsamut et al (2001), López et al (2007), and Acemoglu and Guerrieri (2008). Compared to this literature we introduce a new kind of multi-sector economy suited to discuss the direction of technical change and development under natural resource constraints.…”

Section: Introductionmentioning

confidence: 88%

The Implications of Heterogeneous Resource Intensities on Technical Change and Growth

Pittel

Bretschger

2009

SSRN Journal

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in EconStor may AbstractWe analyze an economy in which sectors are heterogeneous with respect to the intensity of natural resource use. Long-term dynamics are driven by resource prices, sectoral composition, and directed technical change. We study the balanced growth path and determine stability conditions. Technical change is found to be biased towards the resource-intensive sector. Resource taxes have no impact on dynamics except when the tax rate varies over time. Constant research subsidies raise the growth rate while increasing subsidies have the opposite effect. We also find that supporting sectors by providing them with productivity enhancing public goods can raise the growth rate of the economy and additionally provide an effective tool for structural policy.

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“…Hence, their model does not conrm the induced innovation hypothesis. Lopez et al (2007) present a two-sector model where structural change in the direction of the non-resource sector actually ensures sustainable growth, even in the absence of an environmental policy. Bretschger and Smulders (2010) also emphasize the role of structural change as a mechanism for obtaining sustainable development.…”

Section: Literaturementioning

confidence: 99%

Dynamic Effects and Structural Change Under Environmental Regulation in a CGE Model with Endogenous Growth

Ramer

2011

SSRN Journal

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. In this paper, we use a CGE model with endogenous growth to study the interplay between environmental regulation, innovation and sectoral growth. We nd that a stringent reduction target for carbon emissions combined with a CO 2 -tax leads to structural changes. Under the assumption of a unilateral policy, the economy specializes in producing the energy-extensive good. Coupling the carbon tax with policies that aim at directly supporting sectoral capital accumulation signicantly mitigates the negative impacts on competitiveness and growth. Finally, we identify two parameters that play an important role in applied energy policy analysis. First, the assumptions on the substitutability between fossil and non-fossil energy strongly aect the eectiveness of a given policy. When fossil and non-fossil energy are good substitutes, structural change in the economy is far less pronounced than under relative complementarity. Second, the rate of pure time preference has a pronounced impact on the investment incentives and thus on long-run development. Increasing the discount rate from 0.9% to 4.5% leads to a contraction in investments and to lower growth rates in all sectors. Terms of use: Documents inJEL-Classication: C68, O31, O41, Q43

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Structural change and sustainable development

Cited by 74 publications

References 24 publications

Poverty trap and global indeterminacy in a growth model with open-access natural resources

Poverty trap and global indeterminacy in a growth model with open-access natural resources

The Implications of Heterogeneous Resource Intensities on Technical Change and Growth

Dynamic Effects and Structural Change Under Environmental Regulation in a CGE Model with Endogenous Growth

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