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

Gregory Casey

No 9580, CESifo Working Paper Series from CESifo

Abstract: I build a quantitative model of economic growth that can be used to evaluate the impact of environmental policy interventions on final-use energy consumption, an important driver of carbon emissions. In the model, energy demand is driven by directed technical change. Energy supply is subject to increasing extraction costs. The model is consistent with aggregate evidence on energy use, efficiency, and prices in the United States, as well as the standard balanced growth facts. I use the model to conduct several policy analyses. First, I examine the impact of energy taxes and compare the results to the standard Cobb-Douglas approach used in the environmental macroeconomics literature. Second, I investigate how the government can use energy taxes and R&D policy to implement the least-cost path that achieves an environmental target. Finally, I study the dynamic impacts of exogenous improvements in energy efficiency and R&D subsidies for energy efficiency, focusing on the role of rebound. All analyses highlight the importance of transition dynamics.

Keywords: energy; climate change; directed technical change; growth (search for similar items in EconPapers)
JEL-codes: H23 O33 O44 Q43 Q55 (search for similar items in EconPapers)
Date: 2022
New Economics Papers: this item is included in nep-agr, nep-dge, nep-eff, nep-ene, nep-env, nep-gro and nep-ore
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://www.cesifo.org/DocDL/cesifo1_wp9580.pdf (application/pdf)

Related works:
Journal Article: Energy Efficiency and Directed Technical Change: Implications for Climate Change Mitigation (2024)
Working Paper: Energy Efficiency and Directed Technical Change: Implications for Climate Change Mitigation (2019)
Working Paper: Energy Efficiency and Directed Technical Change: Implications for Climate Change Mitigation (2017)
Working Paper: Energy Efficiency and Directed Technical Change: Implications for Climate Change Mitigation
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_9580

Access Statistics for this paper

More papers in CESifo Working Paper Series from CESifo Contact information at EDIRC.
Bibliographic data for series maintained by Klaus Wohlrabe ().