POLLUTION, GOVERNMENT EXPENDITURE, TAXES AND STOCHASTIC GROWTH

摘要

This paper studies a stochastic endogenous growth model with pollution. It introduces government expenditure and exogenous pollution abatement technology to eliminate pollution and proves that under appropriate equilibrium conditions the main economic indexes (including economic growth rate , the optimal government expenditure rate) in the centrally planned economy and decentralized economy can be expressed by the parameters of the model uniquely. The optimal tax policy is analyzed,and the optimal pollution is derived.