Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/171670
Authors: 
Rausch, Sebastian
Schwerin, Hagen
Year of Publication: 
2016
Series/Report no.: 
Economics Working Paper Series 16/227
Abstract: 
We develop a general equilibrium growth theory of vintage capital and energy use in businesses and households to measure the response of energy use to energy-saving technological change. Both investment-specific technological progress and a higher energy price save energy by increasing energy efficiency, yet investment-specific technological progress spurs while a higher energy price depresses energy use. Calibration of the model's balanced growth path to U.S. post-WWII data shows that higher energy efficiency increased rather than reduced energy use. Investment-specific technological progress enhanced energy use by more than the increase in the energy price reduced it. Both neutral and investment-specific technological changes were major determinants of observed growth in energy use.
Subjects: 
Energy efficiency
energy rebound
energy-saving technological change
investment-specific technological change
household production
putty-clay
JEL: 
D13
E23
O30
O41
Q43
Document Type: 
Working Paper

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