Abstract
The paper re-examines the foundations of representation of intertemporal preferences that satisfy intergenerational equity, and provides an axiomatic characterization of those social welfare relations, which are representable by the utilitarian ordering, in ranking consumption sequences which are eventually identical. A maximal point of this ordering is characterized in a standard model of forest management. Maximal paths are shown to converge over time to the forest with the maximum sustained yield, thereby providing a theoretical basis for the tradition in forest management, which has emphasized the goal of maximum sustained yield. Further, it is seen that a maximal point coincides with the optimal point according to the well-known overtaking criterion. This result indicates that the more restrictive overtaking criterion is inessential for a study of forest management under intergenerational equity, and provides a more satisfactory basis for the standard forestry model.
Keywords
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.
This is a preview of subscription content, log in via an institution.
Buying options
Tax calculation will be finalised at checkout
Purchases are for personal use only
Learn about institutional subscriptionsPreview
Unable to display preview. Download preview PDF.
References
Arrow, K.J., Hurwicz, L., & Uzawa, H. (1961). Constraint qualifications in maximization problems. Naval Research Logistics Quarterly, 8, 175–191
Asheim, G.B., & Tungodden, B. (2004). Resolving distributional conflicts between generations. Economic Theory, 24, 221–230.
Asheim, G.B., & Buchholz, W. (2005). Can stock-specific constraints be justified ? Chapter 8 in this Book.
Atsumi, H. (1965). Neoclassical growth and the efficient program of capital accumulation. Review of Economic Studies, 32, 27–136.
Basu, K., & Mitra, T. (2003a). Aggregating infinite utility streams with intergenerational equity: The impossibility of being Paretian. Econometrica 71, 1557–1563.
Basu, K., & Mitra, T. (2003b). Utilitarianism for infinite utility streams: A new welfare criterion and its axiomatic characterization. CAE Working Paper 03-05, Cornell University.
Brock, W.A. (1970a). On existence of weakly maximal programmes in a multi-sector economy. Review of Economic Studies, 37, 275–280.
Brock, W.A. (1970b). An axiomatic basis for the Ramsey-Weizsacker overtaking criterion. Econometrica, 38, 927–929.
Debreu, G. (1954). Representation of a preference ordering by a numerical function. In R.M. Thrall, C.H. Coombs, R.L. Davis, (Eds.), Decision processes (pp.159–165). New York: John Wiley.
Debreu, G. (1959). Theory of value. New York: John Wiley.
Debreu, G. (1960). Topological methods in cardinal utility theory. In K.J. Arrow, S. Karlin, P. Suppes, (Eds.), Mathematical methods in the social sciences. Stanford: Stanford University Press
Debreu, G., & Koopmans, T.C. (1982). Additively decomposed quasiconvex functions. Mathematical Programming, 24, 1–38.
Gale, D. (1967). On optimal development in a multi-sector economy. Review of Economic Studies, 34, 1–18.
Khan, M.A. (2005). Intertemporal ethics, modern capital theory and the economics of forestry. Chapter 3 in this book.
Khan, M.A., & Mitra, T. (2002). Optimal growth in the Robinson-Solow-Srinivasan model: The twosector setting without discounting. Mimeo, Department of Economics, Cornell University, Ithaca.
Koopmans, T.C. (1960). Stationary ordinal utility and impatience. Econometrica, 28, 287–309.
Koopmans, T.C. (1972). Representation of preference orderings over time. In C.B. McGuire, R. Radner, (Eds.), Decision and organization (pp.79–100). New York: North-Holland.
Koopmans, T.C., Diamond, P.A., & Williamson, R.E. (1964). Stationary utility and time perspective. Econometrica, 32, 82–100.
Leontief, W. (1947a). A note on the interrelation of subsets of independent variables of a continuous function with continuous first derivatives. Bulletin of the American Mathematical Society, 53, 343–350.
Leontief, W. (1947b). Introduction to a theory of the internal structure of functional relationships. Econometrica, 15, 361–373.
Malinvaud, E. (1953). Capital accumulation and efficient allocation of resources. Econometrica, 21, 233–268.
McKenzie, L.W. (1968). Accumulation programs of maximum utility and the von Neumann facet. In J.N. Wolfe, (Ed.), Value, capital and growth (pp.353–383). Edinburgh: Edinburgh University Press.
McKenzie, L.W. (1986). Optimal economic growth, turnpike theorems and comparative dynamics. In K.J. Arrow, M. Intrilligator, (Eds.), Handbook of mathematical economics, Vol. 3, (pp.1281–1355). New York: North-Holland Publishing Company.
Mitra, T. (2003). Representation of equitable preferences with applications to aggregative models of economic growth and renewable resources. Mimeo, Department of Economis, Cornell University, Ithaca.
Mitra, T., & Wan, Jr. H.Y. (1986). On the Faustmann solution to the forest management problem. Journal of Economic Theory, 40, 229–249.
Radner, R. (1961). Paths of economic growth that are optimal with regard only to final states: A turnpike theorem. Review of Economic Studies, 28, 98–104.
Ramsey, F. (1928). A mathematical theory of savings. Economic Journal, 38, 543–559.
Samuelson, P.A. (1947). Foundations of economic analysis. Cambridge: Harvard University Press.
Samuelson, P.A. (1976). Economics of forestry in an evolving society. Economic Enquiry, 14, 466–492.
Sen, A.K. (1971). Collective choice and social welfare. Edinburgh: Oliver&Boyd.
Suppes, P. (1966). Some formal models of grading principles. Synthese, 6, 284–306.
Svensson, L.-G. (1980). Equity among generations. Econometrica, 48, 1251–1256.
von Weizsäcker, C.C. (1965). Existence of optimal programs of accumulation for an infinite time horizon. Review of Economic Studies, 32, 85–104.
Yaari, M.E. (1977). A note on separability and quasiconcavity. Econometrica, 45, 1183–1186.
Author information
Authors and Affiliations
Editor information
Editors and Affiliations
Rights and permissions
Copyright information
© 2005 Springer
About this chapter
Cite this chapter
Mitra, T. (2005). Intergenerational Equity and the Forest Management Problem. In: Kant, S., Berry, R.A. (eds) Economics, Sustainability, and Natural Resources. Sustainability, Economics, and Natural Resources, vol 1. Springer, Dordrecht. https://doi.org/10.1007/1-4020-3518-7_7
Download citation
DOI: https://doi.org/10.1007/1-4020-3518-7_7
Publisher Name: Springer, Dordrecht
Print ISBN: 978-1-4020-3465-7
Online ISBN: 978-1-4020-3518-0
eBook Packages: Earth and Environmental ScienceEarth and Environmental Science (R0)