Sustainability of an economy relying on two reproducible assets
Robert D. Cairns,
Stellio Del Campo () and
No 2017-4, EconomiX Working Papers from University of Paris West - Nanterre la Defense, EconomiX
Evaluating the sustainability of a society requires a system of shadow or accounting values derived from the sustainability objective. As a first step toward the derivation of such shadow values for a maximin objective, this paper studies an economy composed of two reproducible assets, each producing one of two consumption goods. The effect of the substitutability between goods in utility is studied by postulating, in turn, neoclassical diminishing marginal substitutability, perfect substitutability and perfect complementarity. The degree of substitutability has strong effects on the maximin solution, affecting the regularity or non-regularity of the program, and on the accounting values. This has important consequences for the computation of genuine savings and the sustainability prospects of future generations.
Keywords: sustainable development; maximin; sustainability accounting; substitutability. (search for similar items in EconPapers)
JEL-codes: O44 Q56 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-acc
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Working Paper: Sustainability of an Economy Relying on Two Reproducible Assets (2017)
Working Paper: Sustainability of an economy relying on two reproducible assets (2017)
Working Paper: Sustainability of an economy relying on two reproducible assets (2016)
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Persistent link: http://EconPapers.repec.org/RePEc:drm:wpaper:2017-4
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