Pollution, carrying capacity and the Allee effect

Stefano Bosi and David Desmarchelier

Working Papers of BETA from Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg

Abstract: In ecology, one of the simplest representation of population dynamics is the logistic equation. This basic view can be enriched by considering two important variables : (1) the maximal population density Nature cansupport (carrying capacity) and (2) the critical density threshold under which the population disappear (Allee effect). The economic literature on biodiversity and renewable resources ignores both these variables. Evidence suggests also that these variables are affected by the pollution leveldue to economic activity. Indeed, a degraded environment is unsuitablefor wildlife and reduces the carrying capacity, while the climate change entails the habitat fragmentation and, lowering the wildlife reproduction possibilities, raises the Allee effect. The present paper aims to incorporate both endogenous carrying capacity and Allee effect in a Ramsey model augmented with biodiversity as a renewable resource. Our extendedframework enables us to study the effect of a Pigouvian tax on anthropogenic mass extinction. We find that, when the household overvalues biodiversity with respect to consumption, a higher green-tax rate is beneficial in three respects entailing: (1) a lower pollution and a higher biodiversity, (2) a welfare improvement and (3) a less likely mass extinction.

Keywords: Allea effect; carrying capacity; pollution; Ramsey model; logistic dynamics; Hopf bifurcation. (search for similar items in EconPapers)
JEL-codes: E32 O44 (search for similar items in EconPapers)
Date: 2018
New Economics Papers: this item is included in nep-ene, nep-env, nep-gro and nep-mac
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Related works:
Working Paper: Pollution, carrying capacity and the Allee effect (2020)
Journal Article: Pollution, carrying capacity and the Allee effect (2019)
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Persistent link: https://EconPapers.repec.org/RePEc:ulp:sbbeta:2018-37

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