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Longevity and environmental quality in an OLG model

Pierre-André Jouvet, Pierre Pestieau () and Gregory Ponthiere ()

No 2007069, CORE Discussion Papers from Université catholique de Louvain, Center for Operations Research and Econometrics (CORE)

Abstract: Whereas existing OLG models with endogenous longevity neglect the impact of environmental quality on mortality, this paper studies the design of the optimal public intervention in a two-period OLG model where longevity is influenced positively by health expenditures, but negatively by pollution due to production. It is shown that if individuals, when choosing how much to spend on health, do not internalize the impact of their decision on environmental quality (i.e. the space available for each person), the decentralization of the social optimum requires a tax not only on capital income, but also, on health expenditures. The sensitivity of the optimal second-best public intervention is also explored numerically.

Keywords: longevity; health care; natural environment; pollution (search for similar items in EconPapers)
JEL-codes: E13 E21 I18 Q56 (search for similar items in EconPapers)
Date: 2007-09-01
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http://www.uclouvain.be/cps/ucl/doc/core/documents/coredp2007_69.pdf (application/pdf)

Related works:
Journal Article: Longevity and environmental quality in an OLG model (2010) Downloads
Working Paper: Longevity and environmental quality in an OLG model (2010) Downloads
Working Paper: Longevity and environmental quality in an OLG model (2010)
Working Paper: Longevity and environmental quality in an OLG model (2010)
Working Paper: Longevity and environmental quality in an OLG model (2007) Downloads
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