Abstinence with Reputation Loss, Understating Expectations and Guiltand the Effectiveness of Emission Tax

The responsibility for, and consequences of, greenhouse gas emissions are shared by all countries, but only a few are willing to tax emissions. The paper argues that the reactions of the abstaining countries are crucial for assessing the effectiveness of the tax. The paper analyzes an interaction between a tax-collecting and investing coalition of rich countries, abstaining rich countries and poor countries. The non-coalition countries might have loss of reputation and guilt and overstate the tax’s emission-moderating effect. As long as these three types of countries react to their counterparts’ emissions, taxing emissions does not necessarily reduce the global emissions.Emission Tax; Abstinence; Understating Expectations; Guilt; Global Emissions

A Stock Targeting International Carbon-Tax Rule with Uncertainty and Diminishing Compliance

This paper develops a rule for setting periodically and internationally a carbon-dioxide atmospheric stock limiting tax in a world inhabited by expected utility maximizing stakeholders facing diminishing mean and increasing variance of their output level due to climate change. The stakeholders are classified as poor, hence unable and/or unwilling to pay, countries and rich countries. Due to ideological and cultural differences, the rich countries' willingness to pay the tax is not identical. Consequently, the number of complying rich countries diminishes with the tax level.Economics; Carbon-Dioxide Stock; Climate Change; Uncertainty; Carbon Tax; International Compliance

Environmental Concern and Rational Production, Consumption and Rehabilitation

Utility from consumption might be spoiled by the degradation of the environment. The incorporation of a direct dependency of utility on the state of the environment through environmental concern and the incorporation of the effects of production pollution and rehabilitative investment on the environment into a lifetime utility maximization model imply that a minimal degree of impatience is necessary for an interior steady state to exist. This steady state is unique, approachable along a path with damped oscillations of consumption and rehabilitative investment, and characterized by a larger production than in the steady state without environmental concern.Consumption, environmental investment, golden rule

Deterrence Capacity, Relative Performance, Adjustment Costs, Hazard, Killing Aversion and the Optimal Enlistment Age

Early-age enlistment increases a small country's potential army size and thereby its attack-deterrence capacity. However, physical and psychological injuries and, ultimately, death generate a loss of quality-adjusted life-years that reduces the net benefit from early-age enlistment. The net benefit from early or later age recruitment is also affected by the rise and decline of the individual's military performance and civilian productivity and by changes in his adjustment costs over the lifespan. The simulations of an optimization model incorporating these elements suggest that if the intensity of the rise and decline of the individual's military performance is sufficiently larger than the intensity of the rise and decline of his civilian productivity, there exists an interior optimal enlistment age greater than the commonly practiced eighteen. In such a case, most of the simulation results are closely scattered around twenty-one despite large parameter changes.Economics, enlistment-age, risk, cost and benefit, decision rule

A Theory of Relative Deprivation and Myopic Addiction

Myopic use of mind-altering substances is proposed to be equal to the product of the user’s current levels of relative-deprivation feeling and substance-tolerance. If initially this product is sufficiently large the user is trapped in a deprivation-use-addiction vicious cycle. There may be a relatively high addiction and socioeconomic position steady state and a relatively low one. If the users are initially located in the high steady state, an increase in treatment is clearly socially desirable. In contrast, the possible improvement of users’ socioeconomic position from increasing law-enforcement or socioeconomic opportunities might be dominated by a rise in users’ addiction level.Relative deprivation, myopia, substance abuse, addiction

A Theory of Chronic Loss, Suffering and Alcoholism

This paper focuses on the consumption of alcohol to numb the suffering associated with failure. While drinking reduces the individual’s current level of suffering, it leads to future failures and potentially greater suffering. The basic model shows that the stationary status of an alcoholic is improved by the difference between his rate of time preference and the rate of return on his status and that this improvement is amplified by the ratio of the instantaneous suffering-relief effect to the status-eroding effect of alcohol. The extended model shows that society’s reaction to alcoholism may lead to permanent cyclical alcohol consumption.alcoholism, suffering, alcohol consumption

A Theory of Rational Junk-Food Consumption

An expected lifetime-utility maximizing diet of junk and health food is analyzed. The stationary junk-food consumption level is equal to the ratio of the recovery capacity of a perfectly healthy person to the sensitivity of her health to junk food. The greater the difference between the relative taste and the stationary relative price of junk food, rate of time preference, and elasticity of satisfaction from food, the better the stationary health of the rational junk-food consumer. The greater the full capacity income, recovery capacity, and health sensitivity to junk-food, the worse the stationary health of the rational junkfood consumer.

Introduction to the Economics of Atmospheric Carbon-Dioxide Control

The objective of this paper is to provide an introduction to the economics of controlling the stock of carbon-dioxide in the atmosphere. The paper starts with a brief summary of the arguments against a wait-and-see strategy and in favour of controlling carbon emissions. It then provides a basic analysis of the effect of carbon tax on net-cash flow maximising agents’ emissions and offers two possible ways for setting the tax rate. The first one computes an atmospheric carbon-dioxide stock-targeting tax rate with abstinence of some agents, whereas the second considers universal cooperation and computes a welfare-maximising carbon-tax rate. While these computations assume a fixed rate of depletion of the atmospheric stock of carbon dioxide, the last section takes the depletion rate to be dependent on the distribution of the usable land between plants and humans and the change in the usable land to be dependent on the change in the atmospheric carbon-dioxide stock. The usable land allocation required for achieving a target stock of atmospheric carbon dioxide is subsequently computed.Emissions; Carbon-Cycle Imbalance; Atmospheric Carbon Stock; Global Warming; Usable land: Control Measures; Carbon Tax; Plants-Humans Land Allocation

To Transplant or Not to Transplant: The Case of Cystic Fibrosis

An organ transplantation rule is constructed with a special reference to the controversial procedure of transplantation of lung sections from living donors to cystic fibrosis patients. The rule indicates the minimum probability of success required for transplantation and how it is related to a wide range of factors associated with the well being and objectives of the directly involved recipient, donor and surgeon.organ transplantation, cystic fibrosis

Partnership with Partial Commitment

This paper derives the Nash-equilibrium degrees of commitment to a partnership where lack of full commitment fuels suspicion and increases potential losses for partners.Structural break, unit root test, Lebanon economy