Human Capital, Innovation, and Climate Policy: An Integrated Assessment
Carlo Carraro (),
Massimo Tavoni () and
Enrica De Cian ()
No 8919, CEPR Discussion Papers from C.E.P.R. Discussion Papers
Abstract:
This paper looks at the interplay between human capital and innovation in the presence of climate and educational policies. Using recent empirical estimates, human capital and general purpose R&D are introduced in an integrated assessment model that has been extensively applied to study the climate change mitigation. Our results suggest that climate policy stimulates general purpose as well as clean energy R&D but reduces the incentive to invest in human capital formation. Human capital increases the productivity of labour and the complementarity between labour and energy drives its pollution-using effect (direct effect). When human capital is an essential input in the production of generic and energy dedicated knowledge, the crowding out induced by climate policy is mitigated, thought not completely offset (indirect effect). The pollution-using implications of the direct effect prevail over the indirect contribution of human capital to the creation of new and cleaner knowledge. A policy mix that combines educational as well as climate objectives offsets the human capital crowding-out with a moderate, short-term consumption loss. Human capital is complement to all forms of innovation and an educational policy stimulates both energy and general purpose innovation. This result has important policy implications considering the growing concern that effective climate policy is conditional on solid economic development and therefore it needs to be supplemented by other policy targets.
Keywords: Climate policy; Human capital; Innovation; Sustainable development (search for similar items in EconPapers)
JEL-codes: O33 O41 Q43 (search for similar items in EconPapers)
Date: 2012-03
New Economics Papers: this item is included in nep-ene, nep-env, nep-hrm, nep-ino and nep-knm
References: View references in EconPapers View complete reference list from CitEc
Citations:
Downloads: (external link)
https://cepr.org/publications/DP8919 (application/pdf)
CEPR Discussion Papers are free to download for our researchers, subscribers and members. If you fall into one of these categories but have trouble downloading our papers, please contact us at subscribers@cepr.org
Related works:
Working Paper: Human Capital, Innovation, and Climate Policy: An Integrated Assessment (2012) 
Working Paper: Human Capital, Innovation, and Climate Policy: An Integrated Assessment (2012) 
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:cpr:ceprdp:8919
Ordering information: This working paper can be ordered from
https://cepr.org/publications/DP8919
Access Statistics for this paper
More papers in CEPR Discussion Papers from C.E.P.R. Discussion Papers Centre for Economic Policy Research, 33 Great Sutton Street, London EC1V 0DX.
Bibliographic data for series maintained by ().