Mainstream economics has not adequately dealt with the long-term consequences of economic growth with regard to the effects of climate change, shifts toward a service-centered economy, and potential financial and fiscal instability. This project helps correct this gap. The effects of climate change are examined in both standard and demand-driven growth models, with emphasis on attainable improvements in welfare from correcting the greenhouse-gas externality (which is often analyzed in a biased fashion in mainstream models). The study also investigates related issues, including the viability of service-centered growth in advanced economies, possible divergence in international growth patterns, and potential financial and fiscal cyclicality and instability.
Economic Sustainability, Distribution, and Stability
This research project focuses on the sustainability of economic growth and implications for distribution, employment, stability, and economic policy.