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Fertility, Mortality and Environmental Policy

Author

Listed:
  • Lehmijoki, Ulla

    (University of Helsinki)

  • Palokangas, Tapio K.

    (University of Helsinki)

Abstract

This article examines pollution and environmental mortality in an economy where fertility is endogenous and output is produced from labor and capital by two sectors, dirty and clean. An emission tax curbs dirty production, which decreases pollution-induced mortality but also shifts resources to the clean sector. If the dirty sector is more capital intensive, then this shift increases labor demand and wages. This, in turn, raises the opportunity cost of rearing a child, thereby decreasing fertility and the population size. Correspondingly, if the clean sector is more capital intensive, then the emission tax decreases the wage and increases fertility. Although the proportion of the dirty sector in production falls, the expansion of population boosts total pollution, aggravating mortality.

Suggested Citation

  • Lehmijoki, Ulla & Palokangas, Tapio K., 2016. "Fertility, Mortality and Environmental Policy," IZA Discussion Papers 10465, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp10465
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    References listed on IDEAS

    as
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    3. Jesús Crespo Cuaresma & Tapio Palokangas & Alexander Tarasyev (ed.), 2013. "Green Growth and Sustainable Development," Dynamic Modeling and Econometrics in Economics and Finance, Springer, edition 127, number 978-3-642-34354-4, May.
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    More about this item

    Keywords

    environmental mortality; pollution tax; population growth; two-sector models;
    All these keywords.

    JEL classification:

    • J13 - Labor and Demographic Economics - - Demographic Economics - - - Fertility; Family Planning; Child Care; Children; Youth
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models

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