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Valuing the Future Economic Theory and Sustainability

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ISBN-10: 0231113072

ISBN-13: 9780231113076

Edition: 1998 (Reprint)

Authors: Geoffrey Heal

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Presenting a framework to understand the earth's future from an economic perspective, this text shows the benefits of viewing the environment as an economic asset and explains how this approach can lead to conservative patterns of resource use.
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Book details

Copyright year: 1998
Publisher: Columbia University Press
Publication date: 10/18/2000
Binding: Paperback
Pages: 224
Size: 5.75" wide x 8.75" long x 0.50" tall
Weight: 0.682
Language: English

Laura Wexler is professor of American studies and women's, gender, and sexuality studies at Yale University.Geoffrey Heal is Garrett Professor of Public Policy and Business Responsibility and professor of economics and finance of the Graduate School of Business at Columbia University. A past president of the Association of Environmental and Resource Economists, he is the author of many scientific articles and thirteen books, including Economic Theory and Exhaustible Resourcesand Nature and the Marketplace.

What Is Sustainability?
History of Sustainability
Possible Formalizations
Limitations of Earlier Approaches
Discounted Utilitarianism
Sustainability: A preliminary Definition
Valuing Environmental Assets
The Analytical Framework
Outline of the Book
National Income
Sustainability within a Classical Framework
The Classical Formulation
Declining Discount Rate
Hamiltonians and Adjoint Variables
Valuing a Depletable Stock
Corner Solutions
Optimal Paths
The Green Golden Rule
The Rawlsian Optimum
Nonseparable Utility Functions
Renewable Resources
Stationary Solutions
Dynamic Behavior
The Green Golden Rule
Ecological Stability
The Rawlsian Solution
A Broader Perspective
Alternatives to Utilitarianism
Formalizing Utilitarianism
Empirical Evidence
Logarithmic Discounting and the Weber-Fechner Law
Zero Discount Rate
Limiting Payoffs
Chichilnisky's Criterion
Comparison with Overtaking
Constancy of Discount Rates
The Rawlsian Criterion
Discounting Utility or Consumption?
Final Comments
Depletion Revisited
Optimization with Chichilnisky's Criterion
Conservation and the Chichilnisky Criterion
Differences from Utilitarian Optima
Renewable Resources Revisited
Constant Discount Rates
Declining Discount Rates
Empirical Evidence on Declining Discount Rates
Time Consistency
Time Consistency and Chichilnisky's Criterion
Asymptotic Time Consistency
Is Consistency Desirable?
Equal Treatment over Finite Horizons
Investment in a Backstop
The Model
Utilitarian Investment
Optimality After the Backstop
Optimality When the Stock Is Exhausted
Optimality Before the Stock is Exhausted
Solving the Problem Recursively
Investing for the Long Run: The Green Golden Rule
The Rawlsian Solution
Investing for Present and Future
Choosing When to Invest
Capital Accumulation
Exhaustibility and Accumulation
The Utilitarian Optimum
Stationary Solutions
Dynamics of the Utilitarian Optimum
The Green Golden Rule
The Chichilnisky Criterion
Capital and Renewable Resources
The Utilitarian Optimum
Stationary Solutions
Dynamics of the Utilitarian Solution
The Green Golden Rule
The Chichilnisky Criterion
Policy Issues
Measuring National Income
Two Concepts of National Income
A General Model
Hicksian Income and the Hamiltonian
Constant Discount Rates
Time-Varying Discount Rates
The Linearized Hamiltonian
Consumption and Hicksian National Income
Hicksian Income and the Discount Rate
Hichsian Income and Resouces
Exhaustible Resources
Renewable Resources
National Income and Capital Accumulation
Nonutilitarian Objectives
National Welfare
A Mathematical Framework
National Welfare and Resources
National Welfare and Hicksian Income in the Hotelling Case
Exhaustible Resources and National Welfare
Renewable Resources and National Welfare
National Welfare and Capital Accumulation
Chichilnisky's Criterion
Sustainable Revenues and National Income
Project Evaluation
Exhaustible Resources
Initial Shadow Prices
Final Shadow Prices
Renewable Resources
Sustainable Net Benefits
Investing in a Backstop Technology
Existence of a Solution for the Exhaustible Resource Case
Existence of a Solution for the Renewable Resource Case