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  4. May 2015
  5. Calculation of a Population Externality

Calculation of a Population Externality

  • Henning Bohn
  • Charles Stuart
American Economic Journal: Economic Policy
vol. 7, no. 2, May 2015
(pp. 61-87)
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Abstract

It is known that when people generate externalities, a birth also generates an externality and efficiency requires a Pigou tax/subsidy on having children. The size of the externality from a birth is important for studying policy. We calculate the size of this "population externality" in a specific case: we consider a maintained hypothesis that greenhouse gas emissions are a serious problem and assume government reacts by optimally restricting emissions. Calculated population externalities are large under many assumptions (JEL D62, H23, J11, J13, Q54, Q58)

Citation

Bohn, Henning, and Charles Stuart. 2015. "Calculation of a Population Externality." American Economic Journal: Economic Policy, 7 (2): 61-87. DOI: 10.1257/pol.20130012

Additional Materials

JEL Classification

  • D62 Externalities
  • H23 Taxation and Subsidies: Externalities; Redistributive Effects; Environmental Taxes and Subsidies
  • J11 Demographic Trends, Macroeconomic Effects, and Forecasts
  • J13 Fertility; Family Planning; Child Care; Children; Youth
  • Q54 Climate; Natural Disasters and Their Management; Global Warming
  • Q58 Environmental Economics: Government Policy
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