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Report
Endogenous policy choice: the case of pollution and growth
What determines the relationship between pollution and growth? Are the forces that explain the behavior over time of these quantities potentially useful to understand more generally the relationship between policies and growth? In this paper, we make a first attempt to analyze the equilibrium behavior of two quantities?the level of pollution and the level of income?in a setting in which societies choose, via voting, how much to regulate pollution. Our major finding is that, consistent with the evidence, the relationship between pollution and growth need not be monotone and that the precise ...
Journal Article
Pricing L.A.'s pollution
Journal Article
Industrial ecology: environmental and economic boon
A movement that began almost accidentally 35 years ago in Denmark is showing that when factories use the waste of other nearby factories as their raw material, advantages to the environment and the local economy abound.
Journal Article
Regulating carbon emissions: the cap-and-trade program
The anti-pollution program in Congress contains desirable economic features. But a key component - an auction process covering all permits for carbon emissions - does not seem to be politically viable.
Journal Article
Dollars in the dirt : the economic value of living trees
Working Paper
Race and Environmental Worries
Working Paper
Optimal Fiscal Policy under Capital Overaccumulation
In a canonical model of heterogeneous agents with precautionary saving motives, Aiyagari (1995) breaks the classical result of zero capital tax obtained in representative-agent models. Aiyagari argues that with capital overaccumulation the optimal long-run capital tax should be strictly positive in order to achieve aggregate allocative efficiency suggested by the modified golden rule (MGR). In this paper, we find that, depending on the sources of capital overaccumulation, capital taxation may not be the most efficient means to restore the MGR when government debt is feasible. To demonstrate ...
Journal Article
Pollution allowances help clear the air
Swapping of pollution allowances in the marketplace gives utilities greater flexibility in curbing sulfur dioxide emissions and ultimately leads to cleaner air.