Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/162181
Authors: 
Bondarev, Anton
Greiner, Alfred
Year of Publication: 
2017
Series/Report no.: 
WWZ Working Paper 2017/03
Abstract: 
In this paper we study the impact of environmental pollution in an endogenous growth model that allows for structural change. The model is based on doubly-differentiated R&D where newer, less polluting technologies gradually replace older ones. The analysis shows that the presence of environmental externalities stimulates structural change but reduces the growth rate of the economy. Further, comparing the models with and without structural change demonstrates that the latter implies stronger environmental damages and, consequently, a lower growth rate than the first one. Finally, levying a tax on the polluting output speeds up structural change, thus, reducing environmental pollution and spurring economic growth. This can give new support for the double dividend hypothesis.
Subjects: 
Environmental Damages
Endogenous Growth
Creative Destruction
Endogenous Structural Change
Double Dividend Hypothesis
JEL: 
Q55
O31
O44
Document Type: 
Working Paper

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