Environmental Policy in an Endogenous Growth Model with Expanding Variety

Affiliation auteursAffiliation ok
TitreEnvironmental Policy in an Endogenous Growth Model with Expanding Variety
Type de publicationJournal Article
Year of Publication2017
AuteursBianco D
JournalREVUE D ECONOMIE POLITIQUE
Volume127
Pagination1013-1028
Date PublishedNOV-DEC
Type of ArticleArticle
ISSN0373-2630
Mots-clésendogenous growth, Environmental policy, Porter hypothesis
Résumé

In this paper, we analyze the long-term impact of an environmental policy on economic growth, pollution and welfare. A standard growth model with horizontal innovation is modified by including pollution which comes from the use of intermediate goods production. Taxation on pollution reduces profits of final good producer as well as intermediate good producers. In this setting, profit gains is explained by a realloaction of labor from intermediate goods sector to R&D sector which enhances innovation, growth and welfare while it reduces pollution.

DOI10.3917/redp.276.1013