We study the optimal growth path and its decentralization in an overlapping generations model with two consumption goods and pollution effect. We consider two production sector i.e. one with a direct effect of pollution and the other with an indirect pollution effect by using energy. In the...

This paper studies the determination of public investment in environmental quality when there are private alternatives. Public investment is chosen by majority voting. When consumption and environmental quality are complementary one may observe a solution of the type "ends against the middle".