The zero discounting and maximin optimal paths in a simple model of global warming

Antoine d'Autume, John M. Hartwick and Katheline Schubert ()

Documents de travail du Centre d'Economie de la Sorbonne from Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne

Abstract: Following Stollery [1998], we extend the Solow, Dasgupta-Heal model to analyze the effects of global warning. The rise of temperature is caused by the use of fossil resources so that the temperature level can be linked to the remaining stock of these resources. The riise of temperature affects both productivity and utility. We characterize optimal solutions for the maximin and zero-discounting cases and present closed form solutions for the case where the production function and utility function are Cobb-Douglas, and the temperature level is an exponential function of the remaining stock of resources. We show that a greater weight of temperature in the preferences or a larger intertemporal elasticity of substitution both lead to postpone resource use.

Keywords: Maximin; zero-discounting; global warming. (search for similar items in EconPapers)
JEL-codes: Q32 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ene and nep-env
Date: 2009-02

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ftp://mse.univ-paris1.fr/pub/mse/CES2009/09013.pdf (application/pdf)

Related works:
Working Paper: The Zero discounting and maximin optimal paths in a simple model of global warming (2009)
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Persistent link: http://EconPapers.repec.org/RePEc:mse:cesdoc:09013

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