Double Dividend Hypothesis, Golden Rule and Welfare Distribution

Mireille Chiroleu-Assouline and Mouez Fodha

Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) from HAL

Abstract: This paper analyzes the double dividend issues within the framework of overlapping generations models. We characterize the necessary conditions for obtaining a double dividend, i.e. an improvement of environmental and non-environmental welfare when the revenue from the pollution tax is recycled into a change in the labor tax rate. We show that, depending on the initial capital stock and on the intertemporal elasticity of substitution, conditions may be defined to simultaneously allow (i) the obtaining of a long term double dividend, (ii) the economy to move closer to the modified golden rule and (iii) in the short term, an improvement in the welfare of the two present generations.

Keywords: Environmental tax; Overlapping generations model; Golden rule; Double dividend (search for similar items in EconPapers)
Date: 2006-05
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00089895
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Citations: View citations in EconPapers (48)

Published in Journal of Environmental Economics and Management, 2006, 51 (3), pp.323-335. ⟨10.1016/j.jeem.2005.09.007⟩

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Journal Article: Double dividend hypothesis, golden rule and welfare distribution (2006)
Working Paper: Double Dividend Hypothesis, Golden Rule and Welfare Distribution (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:hal:cesptp:halshs-00089895

DOI: 10.1016/j.jeem.2005.09.007

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