Title :

Strong Sustainability, Rent and Value-Added Sharing

Author(s) :

Fagnart, Jean-François [Auteur]
Germain, Marc [Auteur]
Lille économie management - UMR 9221 [LEM]
Magnus, Alphonse [Auteur]

Journal title :

Annals of Economics and Statistics

Pages :

309

Publisher :

CNGP-INSEE

Publication date :

2016

ISSN :

2115-4430

English keyword(s) :

Economic resources
Economic growth models
Renewable resources
Economic rent
Natural resources
Economic capital
Sustainable economies
Resource economics
Long run economic growth
Value added

HAL domain(s) :

Sciences de l'Homme et Société/Economies et finances

English abstract : [en]

We reassess Ricardo's conjecture of a secular increase in rent in an endogenous growth model with an essential renewable material resource and rising product quality. The model is consistent with the concept of strong ...
Show more >We reassess Ricardo's conjecture of a secular increase in rent in an endogenous growth model with an essential renewable material resource and rising product quality. The model is consistent with the concept of strong sustainability and thus assumes that the resource productivity is bounded. Hence, only qualitative growth (i.e., a secular increase in the quality of final productions) may persist in the long run. We analyse how the scarcity of the resource affects the rent level and the distribution of national income (between resource, capital and labour) in the short and long runs. In the long run, resource scarcity induces a distributive conflict opposing labour to capital and resource, a lower resource stock implying generally a lower labour share and higher capital and rent shares. The transitory dynamics of the economy is analyzed numerically, starting from initial conditions characterized by a low capital stock and a large potential technical progress. Even if initially the rent share may evolve non-monotonically, simulations tend to confirm that Ricardo's conjecture emerges sooner or later during the transitory dynamics: except in the case of a very high dematerialization potential of final output, the rent share will rise as quantitative growth slows down. JEL: E25, D9, 044, Q0, Q56. / KEY WORDS: Growth, Strong Sustainability, Rent, Functional Distribution of Income, Renewable Resource, Dematerialisation.Show less >

Language :

Anglais

Popular science :

Non

Collections :

• Lille Économie Management (LEM) - UMR 9221

Source :

Harvested from HAL