Feedback to SSRN (Beta)
What type of feedback would you like to send?
Abstract: In the last few years, several studies have found an inverted-U relationship between per capita income and environmental degradation. This relationship, known as the environmental Kuznets curve (EKC), suggests that environmental degradation increases in the early stages of growth, but it eventually decreases as income exceeds a threshold level. The present paper reviews both early and recent contributions on this subject, discussing whether and to what extent such a curve can be empirically observed, and the policy implications that derive from the empirical evidence.
Abstract: Though the recent process of globalisation of international markets succeeded in sustaining the economic growth of the countries that actively participated in this process, the available empirical evidence suggests that it was accompanied by a world-wide increase of environmental degradation and economic inequality. Therefore, there is a growing concern that these features of the globalisation process may jeopardise its social and environmental sustainability. Both environmental and social dimensions of sustainability played a central role in the definition of sustainable development as originally suggested by the Brundtland Commission. The ensuing literature, however, focused almost exclusively on the environmental aspects of sustainability. This paper intends to develop the original, more comprehensive, approach to sustainable development in order to get a deeper understanding of the role that globalisation played and could play in achieving social and environmental sustainability. In particular, it is here investigated how the process of globalisation may affect the relationship between per capita income on one side and inequality (Kuznets curve) or environmental deterioration (environmental Kuznets curve) on the other side. From the analysis carried forward in the paper, some remarks are drawn on a few basic conditions for sustainable globalisation.
globalisation, sustainable development, inequality, environment, Kuznets curve, environmental Kuznets curve
Abstract: The literature on the Kuznets curve and that on the environmental Kuznets curve share several features. The analogy between the two curves concerns not only their shape, but also the theoretical explanations underlying them and the methodology used in the empirical studies. Although the evidence in favor of the curves is not clear-cut, both relationships are the object of a long-lasting debate in the literature for their large policy implications. This works intends to contribute to such debate by investigating what might happen in equilibrium if we assume that both relationships apply. In particular, taking the two curves as stylized facts of the economy, this paper examines possible implications of these empirical regularities on the steady-state equilibrium of the economy. Using a very simple infinite-horizon representative agent model a la Ramsey, we show that three possible outcomes can occur: no steady-state, a unique locally unstable steady-state, and multiple steady-states, with only the high consumption steady-state being locally stable. When a steady-state does exist, stability analysis suggests that inequality across countries may tend to increase.
Abstract: This work examines the impact that economic growth can have on biodiversity and on the ecological dynamics that would naturally emerge in the absence of human activity. The loss of biodiversity may induce policy-makers to implement defensive actions that prevent single species from extinction. These defensive actions, however, may deeply alter the natural dynamics of interaction between species, leading to an ecological equilibrium that is completely different from the one that would exist in the absence of human intervention. This suggests that there might exist a conflict between preserving biodiversity (through stabilization of the ecological system) and preserving the intrinsic features of the ecological dynamics. To investigate this issue more deeply, we analyze the impact that different objective functions and defensive technologies can have on the natural ecological dynamics, and show that human action can modify the stability of the ecological fixed points. From the simple analytical formulations adopted in the paper, it emerges that it is possible to stabilize the ecological fixed point and consequently to avoid the extinction of a species, even in the absence of defensive expenditures specifically finalized at the protection of that species. The stabilizing effect of human intervention, however, turns out to be enhanced when specific defensive expenditures are implemented. Finally, numerical simulations suggest that human activity can have an even deeper impact on the ecological dynamics, substantially modifying not only the stability of the fixed points, but also their number.
Biodiversity, Growth, Defensive actions, Ecological dynamics
Abstract: This paper examines a simple North-South growth model where negative externalities may contribute to reinforce economic growth. Agents' welfare depends on three goods in the model: leisure, a common access renewable natural resource (one in each hemisphere) and a non-storable consumption good. Production and consumption of the latter good deplete the renewable natural resource. To protect against such environmental deterioration, agents may increase their labor supply in order to produce an additional amount of the consumption good to be used as a substitute for the depleted natural resource. The consequent growth in production and consumption may generate a further depletion of the natural resource. This may lead to a self-enforcing growth process in a polluted world where individuals work and produce "too much" (i.e. more than socially optimal). We examine the choices of the two hemispheres using a two-population evolutionary game with transboundary pollution across hemispheres. Each agent chooses whether to work low or high. If an agent works low, she can consume the good only to satisfy basic needs (subsistence consumption). If the agent works high, she can consume an additional amount of the good as a substitute for the natural resource (substitution consumption). We assume that people who work high in the North can also have access to the Southern natural resource (e.g. they can afford a holiday in some developing country where natural resources are still relatively unpolluted), whereas the opposite is not true. We show that economic growth in the North and/or in the South may lead to stationary states that are Pareto dominated by states of the world with a lower level of production and consumption. Moreover, negative environmental externalities from the North to the South may foster growth in the South, which may have in turn feedback effects on growth in the North. Finally, we discuss possible welfare effects of transferring the environmental impact of Northern production to the South and show that such a policy may decrease welfare in both hemispheres.
Defensive Expenditures, Growth, Environment, North-South Interactions
Abstract: This paper examines whether it is possible for all countries to simultaneously achieve efficient and sustainable allocations of resources even if they do not cooperate in a world with inter-generational and intra-generational externalities. Using a simple model with two governments - one for the north and one for the south - we show that one hemisphere cannot always achieve efficiency and sustainability independently of the other, that is, whatever allocation is chosen by the other hemisphere. However, the north and the south can simultaneously achieve efficiency and sustainability if each government aims separately at these two goals in its own hemisphere.
Sustainable development, North-South interactions, intra- and inter-generational externalities
© 2009 Social Science Electronic Publishing, Inc. All Rights Reserved. Terms of Use Privacy Policy This page was served by apollo 4 in 0.078 seconds.