IDEAS home Printed from https://ideas.repec.org/p/ssb/dispap/991.html
   My bibliography  Save this paper

Directed technical change and the resource curse

Author

Listed:

Abstract

The "resource curse" is a potential threat to all countries relying on export income from abundant natural resources such as fossil fuels. The early literature hypothesized that easily accessible natural resources would lead to lack of technological progress. In this article we instead propose that abundance of fossil fuels can lead to the wrong type of technological progress. In order to inquire into our research question, we build a model of a small, open economy having specialized in export of fossil fuels. R&D in fossil fuel extraction technology competes with R&D in clean energy technologies. Moreover, technological progress is path dependent as current R&D within a technology type depends on past R&D within the same type. Finally, global climate policy may reduce the future value of fossil fuel export. We find that global climate policy may either lead to a resource curse or help the country escaping a potential resource curse. The ripeness of the clean energy technologies is essential for the outcomes: If the clean technology level is not too far beyond the fossil fuel technology, a shift to exporting clean energy is optimal independent of global climate policy and climate policy can accelerate this shift. While if the clean technology is far behind, a shift should only happen as a response to global climate policy, and the government should intervene to accelerate this shift.

Suggested Citation

  • Mads Greaker & Tom-Reiel Heggedal & Knut Einar Rosendahl, 2022. "Directed technical change and the resource curse," Discussion Papers 991, Statistics Norway, Research Department.
  • Handle: RePEc:ssb:dispap:991
    as

    Download full text from publisher

    File URL: https://www.ssb.no/en/teknologi-og-innovasjon/forskning-og-innovasjon-i-naeringslivet/artikler/directed-technical-change-and-the-resource-curse/_/attachment/inline/4675c58e-01d5-4692-a946-57f717978380:5021938df5b60fb1b337d6be1712a0c50613dd5a/DP991_web.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    More about this item

    Keywords

    Environment; Directed technological change; Innovation policy; Resource curse;
    All these keywords.

    JEL classification:

    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ssb:dispap:991. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: L Maasø (email available below). General contact details of provider: https://edirc.repec.org/data/ssbgvno.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.