Global Public Goods , Inequality and Institutional Change

In recent years, there has been a huge increase in interest in the environment and its interaction with the economy. A key feature of this literature is its recognition of the interdependence between the economy and the environment. In general, this interdependence operates in both directions and it is poorly understood. A rather overlooked issue is how economic institutions a¤ect our ability and willingness to provide GPG such as environment quality. In addressing Bromley’s question "How do we wish the future to unfold for us?", this paper develops an argument according to which future research will need to devote resources to understanding the spillovers between institutional settings and incentives to provide global public goods. I focus on labour market institutions as labour markets are traditionally the "environment" in which inequality is created and perpetuated at the local and global levels. In this paper I argue that LM institutional design, via its impact on risk and uncertainty, may have sizeable implications on the provision of environmental care, particularly in times of demographic change. Acknowledgements I wish to thanks Maurizio Franzini and Stefano Zamagni for helpful comments to previous versions of this paper. Research Assistance by Adeline Tubb is gratefully acknowledged. Please send your comments to [email protected]