Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/88124
Authors: 
Papageorgiou, Chris
Saam, Marianne
Schulte, Patrick
Year of Publication: 
2013
Series/Report no.: 
ZEW Discussion Papers 13-087
Abstract: 
Recently Acemolgu, Aghion, Bursztyn and Hemous (AER 2012) formulated a model in which a high macroeconomic elasticity of substitution between clean and dirty production represents a crucial condition for green growth. Until now it has never been systematically estimated. Using a novel panel of cross-country sectoral data, we formulate specifications of nested CES production functions that allow to estimate a special case of this parameter: the elasticity of substitution between clean and dirty energy inputs. Contrary to what is expected based on the earlier interfuel substitution literature, we find evidence that this elasticity exceeds one.
Subjects: 
clean and dirty energy inputs
aggregate elasticity of substitution
CES function
cross-country sectoral data
environmental policy
JEL: 
O44
O47
Q54
Q58
Document Type: 
Working Paper

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