Long Run Trends in Energy-Related External Costs
AbstractThis paper considers how energy-related external costs change through time. It focuses on one of the key periods in the history of energy. After a period of declining coal prices and soaring consumption which fuelled the Second Industrial Revolution, the nineteenth century British economy was externalising the social costs of energy production and consumption on a massive scale. Rising from 25% in the 1820s, an estimated 60%-70% of the average social costs of coal were externalised in the 1880s, imposing damages close to 20% of GDP. The eventual decline in air pollution concentration (around 1900) occurred fifty years later than was broadly socially optimal. This experience highlights the evolution of the demand for and supply of environmental quality in the context of economic growth, and the nature of related market and government failures, implying the necessity for adaptation rather than encouraging mitigation. This experience may offer lessons for climate analysis and policy-making.
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Bibliographic InfoPaper provided by BC3 in its series Working Papers with number 2011-01.
Date of creation: Jan 2011
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Publication status: Published
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Web page: http://www.bc3research.org/
External costs; Energy; Coal; Historical; Long Run; Air Pollution; Mining;
Other versions of this item:
- NEP-ALL-2011-01-23 (All new papers)
- NEP-ENE-2011-01-23 (Energy Economics)
- NEP-HIS-2011-01-23 (Business, Economic & Financial History)
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- Fouquet, Roger, 2012.
"The demand for environmental quality in driving transitions to low-polluting energy sources,"
Elsevier, vol. 50(C), pages 138-149.
- Roger Fouquet, 2011. "The Demand for Environmental Quality in Driving Transitions to Low Polluting Energy Sources," Working Papers 2011-11, BC3.
- Greasley, David & Hanley, Nicholas & Kunnas, Jan & McLaughlin, Eoin & Oxley, Les & Warde, Paul, 2012. "How Environmental Pollution from Fossil Fuels can be included in measures of National Accounts and Estimates of Genuine Savings," Stirling Economics Discussion Papers 2012-16, University of Stirling, Division of Economics.
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