Energy Efficiency and Directed Technical Change: Implications for Climate Change Mitigation

• 成果类型: Article
• 署名作者: Casey, Gregory
• 署名单位: Williams College
• 刊物名称: REVIEW OF ECONOMIC STUDIES
• ISSN/ISSBN: 0034-6527
• DOI: 10.1093/restud/rdad001
• 发表日期: 2024
• 页码: 192-228
• 关键词: technological-change; INNOVATION; POLICY; GROWTH; substitution; intensity; emissions; drivers; IMPACT; taxes

摘要

I develop a directed technical change model of economic growth and energy efficiency in order to study the impact of climate change mitigation policies on energy use. I show that the standard Cobb-Douglas production function used in the environmental macroeconomics literature overstates the reduction in cumulative energy use that can be achieved with a given path of energy taxes. I also show that, in the model, the government combines energy taxes with research and development (R&D) policy that favors output-increasing technology-rather than energy efficiency technology-to maximize welfare subject to a constraint on cumulative energy use. In addition, I study energy use dynamics following sudden improvements in energy efficiency. Exogenous shocks that increase energy efficiency also decrease the incentive for subsequent energy efficiency R&D and increase long-run energy use relative to a world without the original shock. Subsidies for energy efficiency R&D, however, permanently alter R&D incentives and decrease long-run energy use.