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Estimating The Non‐Environmental Consequences Of Greenhouse Gas Reductions Is Harder Than You Think

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  • STEPHEN J. DECANIO

Abstract

Top‐down and bottom‐up models of the non‐environmental consequences of policies to reduce greenhouse gas emissions embody different implicit theories of economic organizations. Yet neither approach is explicit in showing the detailed computations that must be traced if the activities of firms are to be described realistically. Specification of firms' computational processes leads inevitably to a consideration of potential computational limits on the behavior of organizations. It is known that solutions of some standard economic problems are not effectively computable, and that the solutions to others are computationally intractable. These fundamental computational limits have strong implications for the theory of the firm, and recognizing their existence and importance suggests new policy approaches for reducing greenhouse gas emissions. (JEL C6, D2, L2, Q4)

Suggested Citation

  • Stephen J. Decanio, 1999. "Estimating The Non‐Environmental Consequences Of Greenhouse Gas Reductions Is Harder Than You Think," Contemporary Economic Policy, Western Economic Association International, vol. 17(3), pages 279-295, July.
    • Handle: RePEc:bla:coecpo:v:17:y:1999:i:3:p:279-295
    DOI: 10.1111/j.1465-7287.1999.tb00682.x
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    Cited by:

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    3. B. Howarth, Richard & Haddad, Brent M. & Paton, Bruce, 2000. "The economics of energy efficiency: insights from voluntary participation programs," Energy Policy, Elsevier, vol. 28(6-7), pages 477-486, June.
    4. Madlener, Reinhard & Stagl, Sigrid, 2005. "Sustainability-guided promotion of renewable electricity generation," Ecological Economics, Elsevier, vol. 53(2), pages 147-167, April.

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    More about this item

    JEL classification:

    • C6 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling
    • D2 - Microeconomics - - Production and Organizations
    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy

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