Abstract
Abstract This paper presents a simple two-period overlapping generations model that contains environmental and health issues. It investigates an intergenerational conflict between old and young generations as regards two defensive expenditures offsetting the influence of a worsening environment represented here by health care and environmental investment. Workers support environmental maintenance while retirees prefer investing in health care. The authors have shown that an increasing support for private health expenditure leads to a higher level of capital accumulation and leads also to a higher level of environmental quality if the maintenance efforts are higher than consumption externalities.
Highlights
Age-based matters have a direct impact on population preferences
With the knowledge of this intergenerational conflict, we explore the question of how and whether a population of two groups: young and old; support two defensive expenditures represented here by health care and environmental maintenance and affecting capital accumulation and environmental quality
We have shown the effects of the competitive mechanism in terms of health expenditure, environmental quality, capital accumulation and consumption possibilities
Summary
Age-based matters have a direct impact on population preferences. The old individuals don’t profit from long-term expenditure choices. Old individuals appreciate private healthcare expenditure instead of the environment investments due to the fact that they take usually more time to be totally effective they can last for a longer time They do not enjoy future environmental improvements. With the knowledge of this intergenerational conflict, we explore the question of how and whether a population of two groups: young and old; support two defensive expenditures represented here by health care and environmental maintenance and affecting capital accumulation and environmental quality. Our contribution is probably closest to the paper of Gutierrez (2008) who studies the impact of health investment on physical capital She proclaims that the stock of pollution leads to a health cost only when individuals are elderly.
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