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Directed Technical Change, Environmental Sustainability, and Population Growth

Peter K. Kruse-Andersen
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Peter K. Kruse-Andersen: Department of Economics, University of Copenhagen, Denmark

No 19-12, Discussion Papers from University of Copenhagen. Department of Economics

Abstract: Population growth has two potentially counteracting effects on pollution emissions:(i) more people implies more production and thereby more emissions, and (ii) more people implies a larger research capacity which might reduce the emission intensity of production, depending on the direction of research. This paper investigates how to achieve a given climate goal in the presence of these two effects. A growth model featuring both directed technical change and population growth is developed. The model allows for simultaneous research in polluting and non-polluting technologies. Both analytical and numerical results indicate that population growth is a burden on the environment, even when all research efforts are directed toward non-polluting technologies. Thus research subsidies alone cannot ensure environmental sustainability. Instead, the analysis shows that environmental sustainability requires pollution taxes and/or population control policies.

Keywords: Directed technical change; endogenous growth; environmental policy; environmental sustainability; climate change; population growth (search for similar items in EconPapers)
JEL-codes: J11 O30 O41 Q54 Q55 Q58 (search for similar items in EconPapers)
Pages: 55 pages
Date: 2019-11-19
New Economics Papers: this item is included in nep-agr, nep-ene, nep-env, nep-gro, nep-ore and nep-res
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