On the Effect of Technological Progress on Pollution: a New Distortion in an Endogenous Growth Model (original) (raw)

Economic growth often results in environmental issues due to increased resource use and pollution. This paper examines the relationship between technological progress and pollution within an endogenous growth model, highlighting the importance of integrating environmental variables into economic growth analysis. It quantifies the externalities associated with pollution and R&D, revealing how these factors lead to distortions in resource allocation and growth rates, ultimately arguing for more effective government intervention to stimulate green technological advancements.