Resource title

Pareto optimality in the extraction of fossil fuels and the greenhouse effect: a note

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Resource description

This note generalizes the Solow-Stiglitz efficiency condition for natural resources to the problem of fossil fuel extraction with a greenhouse effect. The generalized optimality condition suggests that the greenhouse effect implies overextraction in the sense of leaving future generations a wrongly composed wealth portfolio with too few natural resources relative to man-made capital. This judgment is independent of society s ethical preferences concerning the well-being of future generations.

Resource author

Hans-Werner Sinn

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Resource publish date

Resource language

eng

Resource content type

text/html

Resource resource URL

http://hdl.handle.net/10419/26128

Resource license

Adapt according to the presented license agreement and reference the original author.