Optimal growth with pollution: how to use pollution permits ?

Pierre-André Jouvet, Philippe Michel and Gilles Rotillon
Additional contact information
Gilles Rotillon: THEMA

Cahiers de la Maison des Sciences Economiques from Université Panthéon-Sorbonne (Paris 1)

Abstract: We study optimal growth and its decentralization in an overlapping generations model. The decentralization of an optimal path needs some specific taxes in addition to lump-sum transfers if there are externalities. The introduction of market of permits allows neutralizing the external environmental effects. We shows that there is a unique management of permits such that the equilibrium coincides with the optimal path : all permits should be auctioned i.e. no permits to firms. This conclusion is in contradiction with the usual pratice of grandfathering.

Keywords: Optimal growth; environment; market of permits. (search for similar items in EconPapers)
JEL-codes: D61 D9 Q28 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-ene, nep-env and nep-res
Date: 2004-02
View list of references

Downloads: (external link)
ftp://mse.univ-paris1.fr/pub/mse/cahiers2004/V04012.pdf (application/pdf)

Related works:
Journal Article: Optimal growth with pollution: how to use pollution permits? (2005)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:mse:wpsorb:v04012

Access Statistics for this paper

More papers in Cahiers de la Maison des Sciences Economiques from Université Panthéon-Sorbonne (Paris 1)
Contact information at EDIRC.
Series data maintained by Jacqueline Pradel ().