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Learning-by-Doing in the Renewable Energy Equipment Industry or in Renewable Electricity Production: Why Does It Matter to Differentiate?

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  • Katja Schumacher
  • Michael Kohlhaas

Abstract

In economic models of energy and climate policy, endogenous technological change is generally introduced as the result of either investment in research-and-development or of learning-by-doing. In this paper, we analyze alternative ways of modeling learning-by-doing in the renewable energy sector in a top-down CGE model. Conventionally, learning-by-doing effects in the renewable energy sector are allocated to the production of renewable based electricity. We build on the observation that learning-by-doing also takes place in sectors that deliver capital goods to the renewable electricity sector, in particular in the production of machinery and equipment for renewable energy technologies. We therefore implement learning-by-doing alternatively in the renewable energy equipment industry and in renewable electricity production and show why it matters to differentiate between these two approaches. The main differences originate from effects on international trade, since the output of the machinery and equipment sector is intensively traded on international markets unlike renewable electricity.

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File URL: http://www.diw.de/documents/publikationen/73/diw_01.c.57363.de/dp692.pdf
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Bibliographic Info

Paper provided by DIW Berlin, German Institute for Economic Research in its series Discussion Papers of DIW Berlin with number 692.

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Length: 29 p.
Date of creation: 2007
Date of revision:
Handle: RePEc:diw:diwwpp:dp692

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Related research

Keywords: Learning-by-doing; wind energy; general equilibrium modeling; international trade;

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References

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  1. Alwyn Young, 1991. "Learning by Doing and the Dynamic Effects of International Trade," NBER Working Papers 3577, National Bureau of Economic Research, Inc.
  2. Vollebergh, Herman R.J. & Kemfert, Claudia, 2005. "The role of technological change for a sustainable development," Ecological Economics, Elsevier, vol. 54(2-3), pages 133-147, August.
  3. Young, Alwyn, 1991. "Learning by Doing and the Dynamic Effects of International Trade," The Quarterly Journal of Economics, MIT Press, vol. 106(2), pages 369-405, May.
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Cited by:
  1. Joan Canton & �sa Johannesson Lind�n, 2010. "Support schemes for renewable electricity in the EU," European Economy - Economic Papers 408, Directorate General Economic and Monetary Affairs (DG ECFIN), European Commission.

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