This paper demonstrates that technological progress in production of renewable energy can influence the extraction path of fossil fuels indirectly by a change in the equilibrium interest rate. We show in a simple model that the indirect effect can be so strong that first-period or even aggregate...

This paper discusses the influence of public ownership on trade policy instruments. We demonstrate three important invariance results. First, the degree of public ownership affects neither the level of socially optimal activities nor welfare if the government chooses optimal trade policy...

Long run economic growth goes along with structural change. Recent work has identified explanatory factors on the demand side (non-homothetic preferences) and on the supply-side, in particular differential productivity growth across sectors and differences in factor proportions and capital...

We show that (i) subsidies for renewable energy policies with the intention of encouraging substitution away from fossil fuels may accentuate climate change damages by hastening fossil fuel extraction, and that (ii) the opposite result holds under some specified conditions. We focus on the case...

There has been a shift of manufacturing industries from OECD countries to emerging countries. In a competitive global economy increases in productivity in any country are generally welfare-enhancing. The established industrialised countries can suffer from the collapse of some industries, and...

We consider the effect of an increase in the risk from pollution. We show that in the case of a flow pollution, when the number of players is sufficiently large, the result of Bramoulle and Treich, showing that a marginal increase of risk in the neighborhood of a risk-free world is...

Parents care about their children, spend resources on educating them and bequeath them some physical and/or human capital. Here we argue that the actions of the parents have an influence, not only on the productive possibilities open to the children (through the capital they inherit) but also on...

In this paper, we consider a knowledge accumulation problem within an organization. We depart from the human capital theory initiated by Becker (1962, 1964) and consider an organization that cannot prevent the worker from quitting and using the knowledge outside the organization. We study how...

This paper examines how two geographically separated ports compete for a market consisting of manufacturing firms located between the two ports. There is a firm in each port, and these two firms, taking the infrastructure provided by their governments as given, compete in a Bertrand sense. The...

This paper proposes a new welfare criterion which satisfies three desiderata: strong sensitivity to the least advantaged, sensitivity to the present, and sensitivity to the future. We develop necessary conditions for optimal paths under this new criterion, and demonstrate that, in a familiar...