An important yet largely unexamined issue is how the interaction between deforestation and pollution affects economic and environmental sustainability. This article seeks to bridge the gap by introducing a dynamic model of pollution accumulation where polluting emissions can be mitigated and the absorption efficiency of pollution sinks can be restored. We assume that emissions are due to a production activity, and we include deforestation both as an additional source of emissions and as a cause of the exhaustion of environmental absorption efficiency. To account for the fact that the switching of natural sinks to a pollution source can be either possible, and in such a case even reversible, or impossible, we consider that restoration efforts can be either independent from or dependent on environmental absorption efficiency, i.e., state-independent versus state-dependent restoration efforts. We determine (i) whether production or deforestation is the most detrimental from environmental and social welfare perspectives, and (ii) how state-dependent restoration process affects pollution accumulation and deforestation policies and the related environmental and social welfare consequences.
EL OUARDIGHI, F., KHMELNITSKY, E. et LEANDRI, M. (2020). Production-Based Pollution Versus Deforestation: Optimal Policy With State-Independent And-Dependent Environmental Absorption Efficiency Restoration Process. Annals of Operations Research, 292(1), pp. 1–26.