TY - JOUR
T1 - Sustainability and the intergenerational distribution of natural resources entitlements
AU - Gerlagh, R.
AU - Keyzer, M.A.
PY - 2001
Y1 - 2001
N2 - The paper describes an OLG economy with a single exhaustible resource that has amenity value. The steady states of this economy form a continuum, implying path-dependency. We compare three policy scenarios; first, a 'zero extraction' policy of enforced conservation that avoids environmental degradation, possibly at the expense of intertemporal efficiency. Second, a 'grandfathering' policy that endows the present generations with all resources, and that ensures efficiency but cannot prevent a persistent decline in lifetime utility from one generation to the next. Third, a 'trust fund' policy, where future generations receive claims for the natural resource. Of the three, only the trust fund ensures efficiency and protects welfare of all generations. © Elsevier Science S.A.
AB - The paper describes an OLG economy with a single exhaustible resource that has amenity value. The steady states of this economy form a continuum, implying path-dependency. We compare three policy scenarios; first, a 'zero extraction' policy of enforced conservation that avoids environmental degradation, possibly at the expense of intertemporal efficiency. Second, a 'grandfathering' policy that endows the present generations with all resources, and that ensures efficiency but cannot prevent a persistent decline in lifetime utility from one generation to the next. Third, a 'trust fund' policy, where future generations receive claims for the natural resource. Of the three, only the trust fund ensures efficiency and protects welfare of all generations. © Elsevier Science S.A.
U2 - 10.1016/S0047-2727(99)00122-X
DO - 10.1016/S0047-2727(99)00122-X
M3 - Article
SN - 0047-2727
VL - 79
SP - 315
EP - 341
JO - Journal of Public Economics
JF - Journal of Public Economics
IS - 2
ER -