Net energy analysis in a Ramsey-Hotelling growth model
AbstractThis article presents a dynamic growth model with energy as an input in the production function. The available stock of energy resources is ordered by a quality parameter based on energy accounting: the “Energy Return on Energy Invested” (EROI). To our knowledge this is the first paper where EROI fits in a neoclassical growth model (with individual utility maximization and market equilibrium), setting the economic use of “net energy analysis” on firmer theoretical ground. All necessary concepts to link neoclassical economics and EROI are discussed before their use in the model, and a comparative static analysis of the steady states of a simplified version of the model is presented.
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Bibliographic InfoPaper provided by Banco de Espa�a in its series Banco de Espa�a Working Papers with number 1217.
Length: 36 pages
Date of creation: Mar 2012
Date of revision:
EROI; net energy analysis; growth; Ramsey-Hotelling; energy depletion;
Find related papers by JEL classification:
- Q00 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - General
- Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy
- O13 - Economic Development, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
This paper has been announced in the following NEP Reports:
- NEP-ALL-2012-04-03 (All new papers)
- NEP-ENE-2012-04-03 (Energy Economics)
- NEP-ENV-2012-04-03 (Environmental Economics)
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