On economic disequilibrium and free lunch

Robert Ayres

Environmental & Resource Economics, 1994, vol. 4, issue 5, 435-454

Abstract: There is a sharp disagreement between mainstream economists and advocates of energy efficiency as regards the potential for “free lunches” or “no regrets” policies to cut greenhouse gas emissions. From an economics perspective, the critical question is whether the economic system is — or is not — close to a Pareto-optimum equilibrium state. If so, it follows that most technological systems now in place are optimum, or nearly so, from an economic perspective. If not, there may be many sub-optimal technologies in place, with corresponding opportunities for very high returns on appropriate investments. This paper presents some of the evidence supporting the latter thesis. Copyright Kluwer Academic Publishers 1994

Keywords: Conservation; disequilibrium; CGE mode(s); pareto-optimality; energy efficiency; “free lunch”; “no regrets” (search for similar items in EconPapers)
Date: 1994
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Citations: View citations in EconPapers (19)

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DOI: 10.1007/BF00691922

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