Transitional Dynamics and Uniqueness of the Balanced-Growth Path in a Simple Model of Endogenous Growth with an Environmental Asset

Musu, Ignazio; Cazzavillan, Guido

doi:10.2139/ssrn.286694

Cited by 9 publications

(16 citation statements)

References 9 publications

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“…On the contrary, it seems that the discovery of the "economic value" of the environment ( in our model) has determined a higher attention towards the environmental issues. 8 It's easy to see that previous observations holds even if g = 0:…”

Section: Transitional Dynamics and Steady State Analysismentioning

confidence: 90%

“…The accumulation equation of the environmental quality takes the following form which can be also found in Becker (1982), Cazzavillan and Musu (2001), Gomez et al (2004), Lozano et al (2005) …”

mentioning

confidence: 88%

“…This positive and sustainable growth performance will last forever because the steady state is reached only for t = 1; but its relative speed will decrease as the economy get closer to the steady state. According to this view, the well-known high-growth performance of many small open tourism economies need not to be interpreted as exogenous and equilibrium phenomenon as part of the literature on tourism tends to do (Lanza and Pigliaru 1994, Nowak and Sahli, 2006, but rather as a temporary and transitional phenomenon with no need to invoke exogenous growth in the terms of trade 8 . Tourism development will eventually stop in the steady state, but such economies will reach this situation only asymptotically.…”

Section: Transitional Dynamics and Steady State Analysismentioning

confidence: 99%

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Tourism Specialization and Environmental Sustainability in a Dynamic Economy

Cerina

2007

Tourism Economics

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This study focuses on the dynamic behaviour of a small open economy specialized in tourism based on natural resources. The author analyses the steady-state properties in two scenarios, with and without public abatement expenditures, and a unique local saddle-point equilibrium is found for both cases. The analysis of the dynamics provides an alternative explanation for the observed positive growth performance of small open tourism-based economies and for the worldwide increases in tourist inflows, which are seen as transitional phenomena towards the path to the steady state. Moreover, in defining the conditions under which tourism development, improvements in environmental quality and economic growth can simultaneously occur, the model provides theoretical microfoundations for sustainable tourism. Finally, in both scenarios, the author analyses the issue of market failures, taking into account two different kinds of externality and finding the respective optimal tax rates that will induce private agents to replicate the social optimum.

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Section: Transitional Dynamics and Steady State Analysismentioning

confidence: 90%

mentioning

confidence: 88%

Section: Transitional Dynamics and Steady State Analysismentioning

confidence: 99%

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Tourism Specialization and Environmental Sustainability in a Dynamic Economy

Cerina

2007

Tourism Economics

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“…Following Becker (1982) and Cazzavillan and Musu (2001), the environmental resource stock is de…ned as the di¤erence between the maximum tolerable pollution stock P and the current pollution stock 0 P t P E t = P P t Di¤erentiating with respect to time we obtain the law of evolution of the environmental stock…”

Section: The Model Without Abatement Expendituresmentioning

confidence: 99%

“…m0 ( m0 (1 ) such that steady state con-8 sumption is maximum in the decentralized solution 6 . If is low ( < ) ; an increase in the love for the environment (as a result of campaigns to sensitize public awareness) gives rise to an increase in consumption too.…”

Section: Steady State Analysismentioning

confidence: 99%

Tourism Specialization and Sustainability: A Long-Run Policy Analysis

Cerina

2006

SSRN Journal

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in Tourism Specialization and Sustainability: A Long-Run Policy Analysis SummaryThis study focuses on the dynamic evolution of a small open economy specialized in tourism based on natural resources when tourist services are supplied to foreign tourists who are crowding-averse and give positive value to the environmental quality. We analyse the steady-state properties and run several policy exercises in two versions of our model: in the first, private agents' income is spent entirely on consumption while, in the second, agents are allowed to invest part of their income in pollution abatement technology (PAT) which artificially increases the rate of regeneration of the environmental asset. A unique locally saddle point equilibrium is found in both versions and for both the market and the centralized solution. Our main findings are that: 1) a corrective income tax raises steady state utility in both versions but is capable of leading the economy in its first-best dynamic path only when agents cannot invest in the PAT; 2) when the PAT is available to the government but not to agents, an income tax which finances abatement expenditures may increase steady state utility with respect to the market solution when the natural regeneration rate of the environment and the degree of crowding-aversion are both low enough; 3) when PAT is available, the market chooses to devote a higher fraction of income to abatement than the central planner but in both cases this fraction is positive only if the natural rate of regeneration is not too large; 4) when PAT is available an income pollution tax does not affect the dynamic path of the market economy. Tourism specialization and sustainability: a long-run policy analysis Keywords Fabio Cerina CRENoS and University of CagliariAbstract This study focuses on the dynamic evolution of a small open economy specialized in tourism based on natural resources when tourist services are supplied to foreign tourists who are crowding-averse and give positive value to the environmental quality. We analyse the steady-state properties and run several policy exercises in two versions of our model: in the …rst, private agents' income is spent entirely on consumption while, in the second, agents are allowed to invest part of their income in pollution abatement technology (PAT) which arti…cially increases the rate of regeneration of the environmental asset. A unique locally saddle point equilibrium is found in both version...

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Stability crossing curves and Hopf bifurcation in an environmental protection expenses model with two delays

Yang

Alsaedi

et al. 2022

Math Methods in App Sciences

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This study is devoted to considering dynamic properties of an environmental protection expenditures model for protected areas (PAs) with two delays. It presents an improved understanding of relationship among tourism, environment, and capital stock in PAs and provides a sustainable strategy to keep the balance between them. The model considers the interactions among environmental resource E$$ E $$, visitors V$$ V $$, and capital stock K$$ K $$ in PAs. The tourism income is used partly to increase the capital stock and partly to protect the environment. In this paper, time delays τ1$$ {\tau}_1 $$ and τ2$$ {\tau}_2 $$ are introduced into the system. The technique of stability crossing curves for two delays is proposed to analyze the occurrence of Hopf bifurcation. Numerical simulations are performed for understanding the analytical results. The results show that under some parameter conditions, the share η$$ \eta $$ of total revenue generated by tourism user fees for environmental protection is related to delays τ1$$ {\tau}_1 $$ and τ2$$ {\tau}_2 $$. Moreover, the environment and the capital stock can be maintained persistently if time delay τ1$$ {\tau}_1 $$ is not too large.

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Transitional Dynamics and Uniqueness of the Balanced-Growth Path in a Simple Model of Endogenous Growth with an Environmental Asset

Cited by 9 publications

References 9 publications

Tourism Specialization and Environmental Sustainability in a Dynamic Economy

Tourism Specialization and Environmental Sustainability in a Dynamic Economy

Tourism Specialization and Sustainability: A Long-Run Policy Analysis

Stability crossing curves and Hopf bifurcation in an environmental protection expenses model with two delays

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