The Role of Energy in the Industrial Revolution and Modern Economic Growth
David I. Stern and Astrid Kander
Authors registered in the RePEc Author Service: Astrid Kristina Kander () and
David I. Stern ()
The Energy Journal, 2012, vol. Volume 33, issue Number 3
The expansion in the supply of energy services over the last couple of centuries has reduced the apparent importance of energy in economic growth despite energy being an essential production input. We demonstrate this by developing a simple extension of the Solow growth model, which we use to investigate 200 years of Swedish data. We find that the elasticity of substitution between a capital-labor aggregate and energy is less than unity, which implies that when energy services are scarce they strongly constrain output growth resulting in a low income steady-state. When energy services are abundant the economy exhibits the behavior of the "modern growth regime" with the Solow model as a limiting case. The expansion of energy services is found to be a major factor in explaining economic growth in Sweden, especially before the second half of the 20th century. After 1950, labor-augmenting technological change becomes the dominant factor driving growth though energy still plays a role.
JEL-codes: F0 (search for similar items in EconPapers)
References: View references in EconPapers View complete reference list from CitEc
Citations View citations in EconPapers (39) Track citations by RSS feed
Downloads: (external link)
Access to full text is restricted to IAEE members and subscribers.
Working Paper: The Role of Energy in the Industrial Revolution and Modern Economic Growth (2011)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:aen:journl:33-3-05
Ordering information: This journal article can be ordered from
Access Statistics for this article
More articles in The Energy Journal from International Association for Energy Economics Contact information at EDIRC.
Series data maintained by David Williams ().