This paper analyzes the impact of consumption externalities on the quot;Pigouvian ranking,'quot; according to which the second-best level of public good provision is smaller than the first-best level. Consumption externalities introduce exceptions to the Pigouvian ranking. Two necessary and...

This paper investigates the impact of externalities on economic growth in an AK model. In contrast to the existing literature, the paper considers finitely-lived agents along the continuous time, overlapping generations literature. A series of new results, not holding for infinitely-lived agent...

This paper studies the designs of optimal tax programs in OLG economies when first, consumption of one household lowers (status) utility of others, and second, consumption harms the environment. Status seeking raises optimal consumption tax rates, and lowers optimal tax rates on capital income