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To analyse the impact of the environmental policies, we start by reviewing   the literature on the environment, technological knowledge and economic   growth. Then, we build a general equilibrium endogenous growth model where   final goods are produced either in the skilled-labour intensive Clean sector   or in the unskilled-labour intensive Unclean sector. By solving numerically   transitional dynamics towards the unique and stable steady state, we observe   that environmental policies encourage scale-invariant technological knowledge   bias. This, in turn, promotes environmental quality, the skill premium and   economic growth. Moreover, the impact of population growth on the   steady-state growth rate is higher under strong households’ environmental   conscientiousness with future generations

Endogenous growth effects of environmental policies