In this paper, we analyze the effects of population aging on economic growth and the environment in a two-period overlapping generations model of growth, aging, and the environment. We show that aging may be beneficial to economic growth and the environment under perfect annuitisation, while possibly harmful under imperfect annuitisation. We also discuss the implications of our results for environmental policy in an aging economy.

The neoclassical economic growth model and its extensions in the fields of environmental economics and endogenous growth theory typically represent welfare as a single argument function of consumption when the models are analytically solved. This simplified welfare specification is narrower than those described in the quality-of-life literature and emphasized by proponents of sustainable development. The purpose of this paper is to analytically solve for the properties of a growth model based on a broader quality-of-life measure. The welfare measure includes two arguments, consumption and the stock of nature capital. This formulation enables an analysis of the consequences of the dynamic tension between conventionally defined economic growth and nature capital preservation. We find that a static model without technical progress yields diverse steady states, stability properties, and comparative statics, while a model with exogenous technical progress exhibits unusual comparative dynamics and balanced growth paths. These unusual outcomes have a number of policy-relevant implications for sustainable development.

There have been increasing pressures by governments and NGOs to restrict international trade in secondary material waste in the conviction that imports of these goods are in reality a disguise for waste dumping by the exporting country. Moreover, cheap imports of secondary material waste tend to crowd out the local recovery system leading to a domestic waste disposal problem. Alternatively, proponents of trade argue that a ban on secondary material waste leads to an inefficient use of resources resulting inevitably in higher economic and environmental costs, both in developed and developing countries. In this paper we set out to investigate if free trade in secondary material waste can support economic development and simultaneously reduce environmental degradation in a developing country and the conditions necessary for the trade to be permitted. In this study we focus on the trade in waste plastics in China. A life cycle model is formulated within an optimization framework and solved by non-linear programming methods. Preliminary results suggest that trade in waste plastics is both economically and environmentally advantageous but under a number of stringent conditions.

There is considerable concern about the effectiveness of China's pollution control policies. Despite government intervention, measures of pollution continue to rise. However, this does not mean that policies have necessarily been ineffective. What matters for the effectiveness of policy is not the overall level of pollution but whether the extent of pollution is improving relative to what it otherwise would have been without a policy intervention. This paper assesses the effectiveness of China's pollution levy system on water pollution, air pollution, and solid wastes using econometric techniques to estimate the effectiveness of government intervention. The paper first sets out a theoretical equilibrium model of pollution and then uses this to derive equations for the demand and supply of pollutants. This theoretical framework is then used to develop an econometrically estimated model. We find that it is possible to estimate a well-defined demand function for pollution (a reduction in environmental quality) but are unable to estimate the supply of environmental goods, suggesting that government regulation rather than consumer preferences are determining the rate of environmental degradation in China. We also find that the pollution levy system has been effective in reducing pollution relative to what it otherwise would have been in China.

Institutions and organizations are regarded as being important in determining the efficiency of economic agents and public units. This study first reviews the economic reforms in silvicultural activities in China's state-owned forestry bureaux, then empirically examines the impact of economic reforms. Panel data from 40 forestry bureaux in Heilongjiang Province, and two different economic regimes: from the pre-reform and economic transition periods, are analyzed by Data Envelopment Analysis (DEA). The technical efficiency has been decomposed into pure technical efficiency and scale efficiency and then examined. Our results show that the economic reforms have increased efficiency on average by about 25 per cent. Moreover, the study qualitatively analyses the sources of improvement and argues that the efficiency gain is a result of reductions in labour shirking and administration costs.

If children contribute to the household by using their time to collect natural resources from common property sources—such as collecting firewood, fetching water, collecting fodder, grazing animals—then local depletion of these resources could potentially increase the demand for children. This feedback could create a dynamically unstable ‘vicious circle’ between population growth and resource depletion. We empirically examine several elements of such a ‘vicious circle’ hypothesis using data from Pakistan with unusually rich detail on both child time use and firewood collection activities. We find that collection activities do absorb a substantial part of household resources; that children's tasks are relatively devoted to collection activities; that child time is a significant, but not a dominant, portion of collection activities; and the presence of older children in the household reduces the time that women devote to household tasks. Exploratory multivariate regressions show a partial correlation between indicators of firewood scarcity and fertility—a relationship that varies across regions of Pakistan.

A contingent valuation study measured citizen willingness to pay (WTP) for an improvement in surface water quality in Latvia. The average respondent was willing to pay 0.7 per cent of household income for the environmental improvement, but that amount was much less than needed to finance the required investments in treatment facilities. While the income elasticity of WTP for the average resident was low (0.56), it increases as income increases, reaching 0.9 at an income level double the current average. As real incomes increase in Latvia, the demand for environmental quality by citizens can be expected to increase substantially.