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Maladaptation and global indeterminacy

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  • Antoci, Angelo
  • Gori, Luca
  • Sodini, Mauro
  • Ticci, Elisa

Abstract

This article analyzes a general equilibrium growth model with overlapping generations and (production-induced) environmental degradation. Individuals react to environmental damages through mitigation or adaptation. In the former case, they reduce production and its environmental impact. In the latter, they do not tackle the causes of the problem but rather its consequences (i.e., the wellbeing loss due to environmental degradation) by increasing defensive expenditures. Despite its simplicity, the model can generate different long-term outcomes: convergence to a stationary state following a unique trajectory or local/global indeterminacy. In the last scenario, initial conditions (history) and individual expectations matter and the model can generate coordination failures and endogenous fluctuations. Results cast doubt on solutions to environmental problems relying on the role of individual behavior change or adaptation.

Suggested Citation

  • Antoci, Angelo & Gori, Luca & Sodini, Mauro & Ticci, Elisa, 2019. "Maladaptation and global indeterminacy," Environment and Development Economics, Cambridge University Press, vol. 24(6), pages 643-659, December.
    • Handle: RePEc:cup:endeec:v:24:y:2019:i:6:p:643-659_6
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    Citations

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    Cited by:

    1. Andrea Caravaggio & Mauro Sodini, 2020. "Local Environmental Quality and Heterogeneity in an OLG Agent-Based Model with Network Externalities," Discussion Papers 2020/257, Dipartimento di Economia e Management (DEM), University of Pisa, Pisa, Italy.
    2. Buccella, Domenico & Fanti, Luciano & Gori, Luca, 2021. "To abate, or not to abate? A strategic approach on green production in Cournot and Bertrand duopolies," Energy Economics, Elsevier, vol. 96(C).
    3. Antoci, Angelo & Borghesi, Simone & Galeotti, Marcello & Sodini, Mauro, 2021. "Living in an uncertain world: Environment substitution, local and global indeterminacy," Journal of Economic Dynamics and Control, Elsevier, vol. 126(C).
    4. Antoci, Angelo & Borghesi, Simone & Galeotti, Marcello & Russu, Paolo, 2022. "Maladaptation to environmental degradation and the interplay between negative and positive externalities," European Economic Review, Elsevier, vol. 143(C).
    5. Andrea Caravaggio & Mauro Sodini, 2022. "Local environmental quality and heterogeneity in an OLG agent-based model with spatial externalities," Journal of Economic Interaction and Coordination, Springer;Society for Economic Science with Heterogeneous Interacting Agents, vol. 17(1), pages 287-317, January.
    6. Chia-Fa Chi & Shiau-Yun Lu & Willow Hallgren & Daniel Ware & Rodger Tomlinson, 2021. "Role of Spatial Analysis in Avoiding Climate Change Maladaptation: A Systematic Review," Sustainability, MDPI, vol. 13(6), pages 1-22, March.
    7. Gori, Luca & Sodini, Mauro, 2020. "Endogenous labour supply, endogenous lifetime and economic development," Structural Change and Economic Dynamics, Elsevier, vol. 52(C), pages 238-259.

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