The name is absent

been depleted (i.e. f^l'= f^,): more consumption good OB' may as well have been consumed
and less investment good OA' produced. The generation of period t unwittingly sacrificed
consumption BB' without receiving the anticipated results in period (t+l).

To sum up: (1) the F constraint-environmental degradation— results in a reduced Y,_+l;
(2) the maximum possible investment—and minimum consumption—need not be opted for in
period t; and (3) the reduced Y_t+l results in factor unemployment in period (t+l).

The policy conclusions that may be drawn are that, first, it is not enough for the
present generation to bequeath pecuniary savings—and presumed investment and consumption
possibilities—to posterity, but it is also necessary to bequeath the natural habitat in similar
condition as it inherited from past generations. In order to do so, it is important to explore
the possibilities of devising global tax mechanisms that could minimise environmental
degradation and increase future production and consumption. The use of the revenue thus
generated to mitigate global developmental concerns would comprise a double dividend.

IV. Global Environmental Taxes

Various market based tax instruments (MBTIs) have been discussed in the literature
in the context of checking environmental decline. ¹¹ They have been described, in the context
of transportation, ¹² in a nutshell by Button (1993) as including:

(i) for vehicles: emissions charges, tradeable permits, differential vehicle standards
taxation, tax allowances for new vehicles;

Command and control regulations such as direct controls on emission, fuel
composition, traffic incidence and routes, or phasing out of high polluting fuels, as
well as indirect controls such as compulsory inspections, scrapping of old and
acquisition of new vehicles, fuel economy standards, speed limits and so on, are not
considered here since the focus is on revenue generation.

MBTIs may, of course, be used to redress industrial or other pollution.

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