Pollution effects on labor supply and growth

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• Article - International Journal of Economic Theory
• CEEES Paper Series

Résumé

Des contributions empiriques récentes ont observé un impact négatif significatif de la pollution sur l’offre de travail. Ces impacts ont été largement ignorés dans la littérature théorique, qui s’est concentrée sur les effets de la pollution sur la demande de consommation. Dans cet article, nous étudions les effets à court et à long terme de la pollution dans un modèle à la Ramsey où la pollution et l’offre de travail sont des arguments non séparables dans les préférences des ménages. Nous déterminons des conditions suffisantes pour l’existence et l’unicité d’un équilibre à long terme et nous montrons comment des effets (négatifs) importants de la pollution sur l’offre de travail peuvent favoriser la volatilité macroéconomique (cycles déterministes proches de l’état stable) par le biais d’une bifurcation flip.

Abstract

Recent empirical contributions have observed a significant negative impact of pollution on labor supply. These impacts have been largely ignored in the theoretical literature, which has focused on the effects of pollution on consumption demand. In this paper we study the short- and long-run effects of pollution in a Ramsey model where pollution and labor supply are non-separable arguments in households’ preferences. We determine sufficient conditions for the existence and uniqueness of a long-term equilibrium and we show how large (negative) effects of pollution on labor supply may promote macroeconomic volatility (deterministic cycles near the steady state) through a flip bifurcation.

Citation

Bosi, Stefano, Desmarchelier, David and Ragot, Lionel, (2015), Pollution effects on labor supply and growth, International Journal of Economic Theory, 11, issue 4, p. 371-388, https://EconPapers.repec.org/RePEc:bla:ijethy:v:11:y:2015:i:4:p:371-388.

@ARTICLE{RePEc:bla:ijethy:v:11:y:2015:i:4:p:371-388,
title = {Pollution effects on labor supply and growth},
author = {Bosi, Stefano and Desmarchelier, David and Ragot, Lionel},
year = {2015},
journal = {International Journal of Economic Theory},
volume = {11},
number = {4},
pages = {371-388},
abstract = {type="main" xml:lang="en"> Recent empirical contributions have observed a significant negative impact of pollution on labor supply. These impacts have been largely ignored in the theoretical literature, which has focused on the effects of pollution on consumption demand. In this paper we study the short- and long-run effects of pollution in a Ramsey model where pollution and labor supply are non-separable arguments in households’ preferences. We determine sufficient conditions for the existence and uniqueness of a long-term equilibrium and we show how large (negative) effects of pollution on labor supply may promote macroeconomic volatility (deterministic cycles near the steady state) through a flip bifurcation.},
url = {https://EconPapers.repec.org/RePEc:bla:ijethy:v:11:y:2015:i:4:p:371-388}
}