Impatience and Intergenerational Equity in a Model of Sustainable Growth

Lee Endress, Sittidaj Pongkijvorasin, James Roumasset () and Basharat Pitafi
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Lee Endress: Asia Pacific Center for Security Studies, Hawaii
Sittidaj Pongkijvorasin: Chulalongkorn University
Basharat Pitafi: Southern Illinois University, Carbondale

No 200906, Working Papers from University of Hawaii at Manoa, Department of Economics

Abstract: We argue that intergenerational neutrality has been prematurely excluded from the dialogue on sustainable growth. By incorporating Burton’s distinction between intragenerational and intergenerational discounting into a model suitable for analyzing sustainability issues, we are able to accommodate some of the underlying concerns. We show that in an economy with a renewable resource, eschewing intergenerational discounting leads to the implication of a sustained growth path, without the necessity of a sustainability constraint. We find that green net national product remains constant along the optimal approach path to golden rule consumption. This avoids the paradox that maximizing sustainable income leads to unsustained consumption and income.

Keywords: Sustainable development; intergenerational equity; intra-generational discounting; renewable resources; green net national product (search for similar items in EconPapers)
JEL-codes: Q56 Q41 Q01 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-env and nep-pke
Date: 2009-05-14
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