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Environmental policy in dynamic models with pollution by consumers: The impact of exogenous shocks and dozy politicians

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  • Barthel, Jens

Abstract

The paper discusses questions resulting from a study of the interaction of exogenous shocks and environmental policy. In a model with pollution as a side effect of consumption environmental policy is introduced in the form of a consumption tax with or without a subsidy on eco-friendly investments. In simulations we observe the dynamic behavior of models before and after sudden changes of exogenous variables. These shocks are jumps in productivity or a sudden depreciation of capital. Additionally we examine the effect of a simultaneous appearance of both types of shocks. Furthermore we investigate the consequences of a lagged reaction of the policy agents.

Suggested Citation

  • Barthel, Jens, 2007. "Environmental policy in dynamic models with pollution by consumers: The impact of exogenous shocks and dozy politicians," MPRA Paper 8229, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:8229
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    References listed on IDEAS

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    More about this item

    Keywords

    Environmental Policy Instruments; Exogenous Shocks;

    JEL classification:

    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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