Optimal Controls in Models of Economic Growth and the Environment

  • Elke Moser
  • Alexia Prskawetz
  • Gernot Tragler
Conference paper
Part of the Lecture Notes in Computer Science book series (LNCS, volume 7116)


We investigate the impact of environmental quality standards on the accumulation of two types of capital (“brown” vs. “green”) and the corresponding R&D investments in an endogenous growth model. We show that environmental regulation as economic policy instrument rather represses economic growth in the long run but fosters green R&D and the accumulation of green capital in the short run. In addition we show that subsidies may support a shift to a greener production and can be used to counteract against repressed accumulation of green capital.


Environmental Regulation Phase Portrait Capital Stock Abatement Cost Environmental Quality Standard 
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Copyright information

© Springer-Verlag Berlin Heidelberg 2012

Authors and Affiliations

  • Elke Moser
    • 1
    • 2
  • Alexia Prskawetz
    • 1
    • 2
  • Gernot Tragler
    • 1
  1. 1.Institute for Mathematical Methods in Economics (IWM)Vienna University of Technology (TU Wien)WienAustria
  2. 2.Vienna Institute of Demography (VID), Austrian Academy of Sciences (OeAW)WienAustria

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