From the Linear Economy to the Circular Economy: A Basic Model

Publikation: Bidrag til tidsskriftTidsskriftartikelfagfællebedømt

This paper sets up a Ramsey model with natural resources to study the optimal recycling of polluting raw materials. Under plausible conditions it is optimal for the economy to go through an initial linear phase with no recycling followed by a circular phase where a fraction of materials is recycled to alleviate growing natural resource scarcity and environmental degradation. In the presence of a Pigouvian tax on nonrecycled materials a competitive market economy will ensure the optimal degree of recycling.
OriginalsprogEngelsk
TidsskriftFinanzarchiv
Vol/bind74
Udgave nummer1
Sider (fra-til)71-87
ISSN0015-2218
DOI
StatusUdgivet - 1 mar. 2018

ID: 214826838