The Global Environment, Natural Resources, and Economic Growth

✍ Scribed by Alfred Greiner, Will Semmler

• Publisher: Oxford University Press
• Year: 2008
• Tongue: English
• Leaves: 219
• Category: Library

✦ Synopsis

Recently, the public attention has turned toward the intricate interrelation between economic growth and global warming. This book focuses on this nexus but broadens the framework to study the issue. Growth is seen as global growth, which affects the global environment and climate change. Global growth, in particular high economic growth rates, imply a fast depletion of renewable and non-renewable resources. Thus this book deals with the impact of the environment and the effect of the exhaustive use of natural resources on economic growth and welfare of market economies as well as the reverse linkage. It is arranged in three parts: Part I of the book discusses the environment and growth. There, Greiner and Semmler incorporate the role of environmental pollution into modern endogenous growth models and use recently developed dynamic methods and techniques to derive appropriate abatement activities that policymakers can institute. Part II looks at global climate change using these same growth models. Here, too, the authors provide direct and transparent policy implications. More specifically, the authors favour tax measures, such as a carbon tax, over emission trading as instruments of mitigation policies. Part III evaluates the use and overuse of renewable and non-renewable resources in the context of a variety of dynamic models. They, in particular, consider the cases when resources interact as an ecological system and analyze issues of ownership of resources as well as policy measures to avoid the overuse of resources. In addition, not only intertemporal resource allocation but also the eminent issues relating to intertemporal inequities, as well as policy measures to overcome them, are discussed in each part of the book.

✦ Table of Contents

Contents......Page 10
Introduction......Page 16
Part I: The Environment and Economic Growth......Page 18
1 Introduction and Overview......Page 20
2.1 The Household Sector......Page 23
2.2 The Productive Sector......Page 24
2.3 The Government......Page 25
2.4 Equilibrium Conditions and the Balanced Growth Path......Page 26
3.1 Growth Effects of Fiscal Policy on the BGP......Page 30
3.2 Growth Effects on the Transition Path......Page 35
3.3 Welfare Effects of Fiscal Policy on the BGP and the Social Optimum......Page 39
4 The Dynamics of the Model with Standard Preferences......Page 44
5.1 The Household Sector......Page 52
5.2 The Productive Sector and the Stock of Pollution......Page 53
5.4 Equilibrium Conditions and the Balanced Growth Path......Page 54
5.5 The Dynamics of the Model......Page 56
5.6 Effects of the Different Scenarios on the Balanced Growth Rate......Page 60
6 Concluding Remarks......Page 64
Part II: Global Warming and Economic Growth......Page 66
7 Introduction and Overview......Page 68
8 Facts on GHG Emissions and the Change in Average Global Surface Temperature......Page 73
9.1 Structure of the Model......Page 76
9.2 The Balanced Growth Path......Page 78
9.3 Numerical Examples......Page 81
10 The AK Endogenous Growth Model......Page 84
10.1 The Second-Best Solution......Page 85
10.2 The Social Optimum......Page 88
10.3 A Multiregion World......Page 90
11.1 The Competitive Economy......Page 102
11.2 The Social Optimum......Page 113
11.3 Modeling Nonlinear Feedback Effects of the Rise in Temperature......Page 120
12 Concluding Remarks......Page 133
Part III: Depletion of Resources and Economic Growth......Page 136
13 Introduction and Overview......Page 138
14.1 Introduction......Page 140
14.2 Economic Growth with Resource Constraints......Page 141
14.3 The Importance of Intergenerational Equity......Page 146
14.4 Assessment of the Finiteness of Resources......Page 150
14.5 Assessment of Petroleum Reserves......Page 153
14.6 Estimation of a Basic Model......Page 155
Appendix: Sketch of Solutions and Data Sources......Page 158
15.1 Introduction......Page 170
15.2 Renewable Resources and Optimal Growth......Page 172
15.3 Open Access: Zero Horizon Optimization......Page 179
15.4 The Monopoly: Infinite Horizon Optimization......Page 184
15.5 Concluding Remarks......Page 188
Appendix......Page 190
16.1 Introduction......Page 193
16.2 The Model......Page 195
16.3 Numerical Results for the Partial and Complete Model......Page 197
16.4 Concluding Remarks......Page 199
Appendix......Page 201
17 Conclusion......Page 203
Appendix: Three Useful Theorems from Dynamic Optimization......Page 207
Bibliography......Page 210
M......Page 218
W......Page 219