The Economy-Wide Effects in The United States of Replacing Crude Petroleum with Biomass

Peter B. Dixon, Stefan Osborne and Maureen T. Rimmer

No 331569, Conference papers from Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project

Abstract: Part of President Bush’s energy policy is to encourage research aimed at reducing the cost of biomass-based motor fuels to become competitive with petroleum-based fuels. We use a dynamic, CGE model to investigate the economy-wide implications of successful implementation of this policy. We find in the long-run, 2020, that the U.S. would experience significant benefits arising from: (1) substitution of biomass whose price is likely to fall in the long-run for crude petroleum whose price is likely to rise; (2) reduction in the world price of crude petroleum; (3) an increase in employment; and (4) an increase in export prices.

Keywords: Resource/Energy Economics and Policy; Agricultural and Food Policy (search for similar items in EconPapers)
Pages: 22
Date: 2007
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Persistent link: https://EconPapers.repec.org/RePEc:ags:pugtwp:331569

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