Armington elasticities for energy policy modeling: Evidence from four European countries

Heinz Welsch

Energy Economics, 2008, vol. 30, issue 5, 2252-2264

Abstract: Elasticities of substitution among imports and competing domestic production (Armington elasticities) play an important role in computable general equilibrium (CGE) assessments of energy and climate policy. This paper provides estimates of Armington elasticities for 15 commodity groups in four European countries. Since Armington elasticities are found to be rather low on average, researchers may want to reconsider the device of using high values of Armington elasticities in CGE models to avoid unrealistic competitiveness effects or emission leakage rates associated with energy or carbon taxes or other forms of energy-related regulation. Estimated elasticities tend to be higher in the case of machinery and other investment goods than in the case of primary products, ores and chemicals, as well as consumer goods.

Date: 2008
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (41)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0140-9883(07)00089-8
Full text for ScienceDirect subscribers only

Related works:
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:eee:eneeco:v:30:y:2008:i:5:p:2252-2264

Access Statistics for this article

Energy Economics is currently edited by R. S. J. Tol, Beng Ang, Lance Bachmeier, Perry Sadorsky, Ugur Soytas and J. P. Weyant

More articles in Energy Economics from Elsevier
Bibliographic data for series maintained by Catherine Liu ().