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Pollution effects on labor supply and growth

Stefano Bosi, David Desmarchelier () and Lionel Ragot ()

No 2014-34, EconomiX Working Papers from University of Paris Nanterre, EconomiX

Abstract: Some recent empirical contributions have pointed out a significant negative impact of pollution on labor supply. These impacts have been largely ignored in the theoretical literature, which, instead, focused on the case of pollution effects on consumption demand. In this paper, we study the short and long-run effects of pollution in a Ramsey model where pollution and labor supply are nonseparable arguments in households’ preferences. We determine sufficient conditions for existence and uniqueness of a longterm equilibrium and we show how large (negative) effects of pollution on labor supply may promotes macroeconomic volatility (deterministic cycles near the steady state) through a flip bifurcation.

Keywords: pollution; endogenous labor supply; Ramsey model. (search for similar items in EconPapers)
JEL-codes: E32 O44 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-agr, nep-dge, nep-ene, nep-env and nep-mac
Date: 2014
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Related works:
Journal Article: Pollution effects on labor supply and growth (2015) Downloads
Working Paper: Pollution effects on labor supply and growth (2015)
Working Paper: Pollution Effects on Labor Supply and Growth (2013) Downloads
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Persistent link: https://EconPapers.repec.org/RePEc:drm:wpaper:2014-34

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