Abstract
The study investigates irreversible pollution damage in the context of renewable resources. It is shown that irreversible pollution damage leads to nonconvexities in dynamic models. There may exist two locally optimal solutions: an optimal infinite horizon solution (sustainable) and an optimal finite horizon solution. In general, the choice between these optimality candidates must be made by comparing the present values of both policies. However, the study shows that there are special cases where the choice can be made on a priori grounds. Including the pollution problem in the renewable resource model changes the ordinary “optimal extinction” results.
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Tahvonen, O. (1995). Pollution, Renewable Resources and Irreversibility. In: Carraro, C., Filar, J.A. (eds) Control and Game-Theoretic Models of the Environment. Annals of the International Society of Dynamic Games, vol 2. Birkhäuser, Boston, MA. https://doi.org/10.1007/978-1-4612-0841-9_12
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DOI: https://doi.org/10.1007/978-1-4612-0841-9_12
Publisher Name: Birkhäuser, Boston, MA
Print ISBN: 978-1-4612-6917-5
Online ISBN: 978-1-4612-0841-9
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