The purpose of this study is to deal with a dynamic interdependence between regional economic growth and endogenous environment change. We build a model with any number of regions with wealth and pollutant accumulation over time. The model is based on a two-regional growth model by Zhang (1996) and a multi-country growth model with endogenous environment by Zhang (2014). Wealth accumulation and pollutant changes are endogenous. Amenity is endogenous in the sense that regional amenity are functions of the population and level of pollutants. The economy is built under assumptions of profit maximization, utility maximization, and perfect competition. We describe the dynamics of region national economy with differential equations. We simulated the model with a 3-region model and demonstrated the existence of a stable equilibrium point. Our comparative dynamic analysis provides some important insights.
Key words: multi-region growth; amenity; pollutant accumulation; environmental policy; wealth accumulation. JEL Classification: R11, O18 Article Language: EnglishTurkish
| 
