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Natural Disasters in a Two-Sector Model of Endogenous Growth AgEcon
Horii, Ryo; Ikefuji, Masako.
This paper studies sustainability of economic growth considering the risk of natural disasters caused by pollution in an endogenous growth model with physical and human capital accumulation. It is shown that economic growth is sustainable only if the tax rate on the polluting input is increased over time and that the long-term rate of economic growth follows an inverted V-shaped curve relative to the growth rate of the environmental tax. The social welfare is maximized under a positive steady-state growth in which faster accumulation of human capital compensates the productivity loss due to declining use of the polluting input.
Tipo: Working or Discussion Paper Palavras-chave: Natural disasters; Human capital; Endogenous depreciation; Economic growth; Environmental Economics and Policy; Resource /Energy Economics and Policy; O41; O13; E22.
Ano: 2010 URL: http://purl.umn.edu/97337
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Optimal Emission Tax with Endogenous Location Choice of Duopolistic Firms AgEcon
Ikefuji, Masako; Itaya, Jun-ichi; Okamura, Makoto.
This paper explores optimal environmental tax policy under which duopoly firms strategically choose the location of their plants in a simple three-stage game. We examine how the relationship between the optimal emission tax and the choice of location of duopoly firms affects the welfare of the home country. We characterize the relationship between the optimal emission tax and the fixed cost, depending on the degree of environmental damage from production. Finally, we show the existence of asymmetric equilibrium in which either firm chooses relocation of its plant even if the duopoly firms are identical ex ante.
Tipo: Working or Discussion Paper Palavras-chave: Environmental Policy; Relocation; Welfare; Environmental Economics and Policy; H23; L13.
Ano: 2010 URL: http://purl.umn.edu/59377
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