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Altruism, environmental externality and fertility

Published online by Cambridge University Press:  20 March 2019

Makoto Hirazawa ,
Kimiyoshi Kamada  and
Takashi Sato
Makoto Hirazawa
Affiliation:
School of Economics, Chukyo University, Nagoya, Japan
Kimiyoshi Kamada*
Affiliation:
School of Economics, Chukyo University, Nagoya, Japan
Takashi Sato
Affiliation:
Faculty of Economics, Shimonoseki City University, Shimonoseki City, Japan
*
*Corresponding author. E-mail: kkamada@mecl.chukyo-u.ac.jp
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Abstract

We investigate the interaction between environmental quality and fertility in an altruistic bequest model with pollution externalities created by the aggregate production. Despite the negative externality related to the endogenous childbearing decisions, parents may choose to have fewer children in the competitive economy than in the social optimum. To achieve optimality, positive taxes on childbearing are required even with an insufficient number of children, if the social discount factor equals the parents' degree of altruism. On the other hand, child allowances may constitute the optimal policy if the social discount factor exceeds the parents' degree of altruism.

Keywords

altruismbequestchild allowancesenvironmental qualityexternalityfertility
Type
Research Article
Information
Environment and Development Economics , Volume 24 , Issue 3 , June 2019 , pp. 317 - 338
Copyright
Copyright © Cambridge University Press 2019 

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