Matching Items (2)
Description
This paper presents a two-period general equilibrium model that incorporates the firm's learning-by-doing under the green subsidies. I use a dynamic version of the Dixit-Stiglitz monopolistic competition model to analyze the impact of the introduction of green subsidies in the presence of pre-existing effluent taxes. I first show that the introduction of green subsidies promotes the demand for green goods, and consumers are better off each period. I then show that even when the green subsidies directly accrue to consumers, firms in the green sector also benefit via boosted demand for green goods. The learning-by-doing effect accelerates the speed of expansion of the green sector in the face of green subsidies. On the other hand, even when the demand for the green goods increases, and greater pollution may result from meeting the increased demand as a whole, environmental quality may still improve if the technology is good enough to sufficiently boost the net positive impact of green consumption on the environment.
ContributorsChung, Myunghun (Author) / Hanemann, W. Michael (Thesis advisor) / Datta, Manjira (Committee member) / Reffett, Kevin (Committee member) / Arizona State University (Publisher)
Created2013
Description
Environmental regulations such as carbon taxation and air quality standards can lead to notable improvements in health outcomes and ambient air quality. However, these types of policies may have significant impacts on the labor market, in particular for workers in energy-intensive industries, especially if these workers have acquired specific human capital in those industries. This dissertation focuses on the general equilibrium consequences of environmental regulation on the labor market. Specifically, I examine costly reallocation of workers between sectors, the welfare effects of involuntary unemployment, and the heterogeneous effects of this policy on different types of workers. To this end, I develop a two-sector search model with sectoral human capital accumulation to explore the effects on the labor market of implementing a per unit of energy use carbon tax in the US. I separate the economy into a high-intensive sector (’dirty’) and a low-intensive sector (’clean’). I calibrate the model using 2014 U.S. data. I find that a carbon tax increases total unemployment by 0.06 percentage points, decreases the dirty employment rate by 2.1 percent, and increases the clean employment rate by 1.04 percent. Firms in the dirty sector adjust by decreasing the demand for high-skilled workers and increasing the number of vacancies in the low-skilled market
ContributorsFernandez Intriago, Luis Armando (Author) / Silverman, Daniel (Thesis advisor) / Kuminoff, Nicolai V. (Committee member) / Fried, Stephanie (Committee member) / Arizona State University (Publisher)
Created2019