Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5053635 | Economic Modelling | 2016 | 12 Pages |
Abstract
We introduce the link between pollution, morbidity and productivity over the life-cycle in a two-period overlapping generations model. As the environmental tax improves the health-profile over the life-cycle, it influences saving, investment in health, labor supply and retirement. As a result, we identify effects of environmental taxation beyond the standard crowding-out and productivity effects captured by the past literature. We show that whether those effects are positive or negative for the economy crucially depends on the degree of substitutability between young and old labor. Our numerical examples suggest that that those new effects alleviate the negative effects of environmental taxation on output and decrease potential positive welfare effects.
Related Topics
Social Sciences and Humanities
Economics, Econometrics and Finance
Economics and Econometrics
Authors
Nathalie Mathieu-Bolh, Xavier Pautrel,