Impact Assessment of Emissions Stabilization Scenarios with and without Induced Technological Change

Claudia Kemfert and Truong Truong ()

No 530, Discussion Papers of DIW Berlin from DIW Berlin, German Institute for Economic Research

Abstract: The main aim of this paper is to investigate quantitatively the economic impacts of emissions stabilization scenarios with and without the inclusion of induced technological change (ITC). Improved technological innovations are triggered by increased R&D expenditures that advance energy efficiencies. Model results show that induced technological changes due to increased investment in R&D reduce compliance costs. Although R&D expenditures compete with other investment expenditures, we find that increased R&D expenditures improve energy efficiency which substantially lowers abatement costs. Without the inclusion of induced technological change, emissions targets are primarily reached by declines in production, resulting in overall welfare reductions. With the inclusion of induced technological changes, emissions mitigations can result in fewer production and GDP drawbacks.

Keywords: Impact assessment of climate policy; Technological change (search for similar items in EconPapers)
JEL-codes: C6 D5 O3 Q4 (search for similar items in EconPapers)
Pages: 16 p.
Date: 2005
New Economics Papers: this item is included in nep-ene and nep-env
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Citations: View citations in EconPapers (1)

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Related works:
Journal Article: Impact assessment of emissions stabilization scenarios with and without induced technological change (2007)
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