THE INTERGENERATIONAL CASE OF MISSING MARKETS AND MISSING VOTERS

A simple game formulation is used to examine the possibility of linkin g generations when a future generation will confront a risk that can b e alleviated by an earlier generation's investment. An insurance marke t will function provided that the overlapping generations are sufficie ntly near in time and share risks. Without propinquity or shared risks , there is a need for intervention to overcome the problems of missing markets and missing voters. This intervention should rake the form of minimum environmental standards, based on a notion of sustainability that is constitutionally enforced.