Pollution and economic growth

Eric Fisher and Charles Marrewijk

The Journal of International Trade & Economic Development, 1998, vol. 7, issue 1, 55-69

Abstract: We analyse a model of overlapping generations in which clean air, a pure public good, is used as a private input into production. Although production exhibits constant returns to scale. endogenous growth can occur. In a laissez-faire equilibrium, firms generate rents that are the value of the pollution they create. These rents crowd out investment and slow economic growth. Such an equilibrium may not support Pareto optimal allocations, but a Pigouvian tax does. Hence, a pollution tax can yield a double dividend because it reduces pollution and increases growth.

Keywords: Environment; growth; double dividend (search for similar items in EconPapers)
Date: 1998
References: View complete reference list from CitEc
Citations: View citations in EconPapers (31)

Downloads: (external link)
http://www.tandfonline.com/doi/abs/10.1080/09638199800000004 (text/html)
Access to full text is restricted to subscribers.

Related works:
Working Paper: Pollution and Economic Growth (1997)
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: https://EconPapers.repec.org/RePEc:taf:jitecd:v:7:y:1998:i:1:p:55-69

Ordering information: This journal article can be ordered from
http://www.tandfonline.com/pricing/journal/RJTE20

DOI: 10.1080/09638199800000004

Access Statistics for this article

The Journal of International Trade & Economic Development is currently edited by Pasquale Sgro, David E.A. Giles and Charles van Marrewijk

More articles in The Journal of International Trade & Economic Development from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().