Pareto-improving environmental policies in an overlapping-generations model

Tetsuo Ono, Yasuo Maeda

Research output: Contribution to journalArticle

4 Citations (Scopus)

Abstract

This paper develops an overlapping-generations model with environmental externalities. In particular, we consider a situation where future generations are made worse off because of environmental degradation caused by the consumption of past generations. We show that there exists an allocation for which the welfare of both current and future generations is strictly increased, relative to a laissez-faire competitive equilibrium allocation. We then demonstrate that this allocation can be achieved by a tax-transfer scheme.

Original languageEnglish
Pages (from-to)211-225
Number of pages15
JournalJapanese Economic Review
Volume53
Issue number2
DOIs
Publication statusPublished - 2002
Externally publishedYes

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Environmental policy
Pareto
Overlapping generations model
Competitive equilibrium
Tax
Environmental degradation
Environmental externalities
Laissez-faire

ASJC Scopus subject areas

  • Economics and Econometrics

Cite this

Pareto-improving environmental policies in an overlapping-generations model. / Ono, Tetsuo; Maeda, Yasuo.

In: Japanese Economic Review, Vol. 53, No. 2, 2002, p. 211-225.

Research output: Contribution to journalArticle

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