Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/57553
Authors: 
Year of Publication: 
2011
Series/Report no.: 
Papers on Economics and Evolution No. 1116
Publisher: 
Max Planck Institute of Economics, Jena
Abstract: 
Strong growth in disposable income has inflated consumption to unprecedented, but not sustainable levels. In this process consumer behavior has been changing. To explain the driving forces of this development, the paper introduces a theory of evolving consumer preferences that is molded in an evolutionary paradigm. The theory allows to better assess how individual welfare would be directly affected by policy measures designed to make consumption sustainable. Such policy measures are likely to also trigger indirect welfare losses by negative employment effects. The policy debate therefore needs to pay attention to both direct and indirect welfare effects. As a concrete proposal a redesign of consumption taxes is discussed that accounts for both concerns.
Subjects: 
consumption
preferences
growth
sustainability
satiation
welfare
consumption tax
JEL: 
A13
D01
D03
D11
D62
H23
H24
Q01
Q38
Document Type: 
Working Paper

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