Directed Technical Change in Labor and Environmental Economics

David Hemous and Morten Olsen ()
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Morten Olsen: Department of Economics, University of Copenhagen, 1165 Copenhagen, Denmark

Annual Review of Economics, 2021, vol. 13, issue 1, 571-597

Abstract: It is increasingly evident that the direction of technological change responds to economic incentives. We review the literature on directed technical change in the context of environmental economics and labor economics, and we show that these fields have much in common both theoretically and empirically. We emphasize the importance of a balanced growth path and show that the lack of such a path is closely related to the slow development of green technologies in environmental economics and to growing inequality in labor economics. We discuss whether the direction of innovation is efficient.

Keywords: endogenous growth; automation; directed technical change; climate change; income inequality (search for similar items in EconPapers)
JEL-codes: E25 J24 O31 O33 O41 O44 Q55 (search for similar items in EconPapers)
Date: 2021
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Citations: View citations in EconPapers (9)

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DOI: 10.1146/annurev-economics-092120-044327

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