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Endogenous Structural Change and Climate Targets Modeling Experiments with Imaclim-R

  • Renaud Crassous, Jean-Charles Hourcade, Olivier Sassi

This paper envisages endogenous technical change that results from the interplay between the economic growth engine, consumption, technology and localization patterns. We perform numerical simulations with the recursive dynamic general equilibrium model Imaclim-R to study how modeling induced technical change affects costs of CO2 stabilization. Imaclim-R incorporates innovative specifications about final consumption of transportation and energy to represent critical stylized facts such as rebound effects and demand induction by infrastructures and equipments. Doing so brings to light how induced technical change may not only lower stabilization costs thanks to pure technological progress, but also trigger induction of final demandÑeffects critical to both the level of the carbon tax and the costs of policy given a specific stabilization target. Finally, we study the sensitivity of total stabilization costs to various parameters including both technical assumptions as accelerated turnover of equipments and non-energy choices as alternative infrastructure policies.

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Article provided by International Association for Energy Economics in its journal The Energy Journal.

Volume (Year): Endogenous Technological Change (2006)
Issue (Month): Special Issue #1 ()
Pages: 259-276

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Handle: RePEc:aen:journl:2006se-a13
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  1. Smulders, J.A. & de Nooij, M., 2003. "The impact of energy conservation on technology and economic growth," Other publications TiSEM c4db0986-2132-4216-aa53-0, Tilburg University, School of Economics and Management.
  2. Jean Charles Hourcade & Frédéric Ghersi & Patrick Criqui, 2003. "Viable Responses to the equity-responsability dilemna : a consequentialist view," CIRED Working Papers halshs-00000965, HAL.
  3. David G. Blanchflower & Andrew J. Oswald, 1995. "An Introduction to the Wage Curve," Journal of Economic Perspectives, American Economic Association, vol. 9(3), pages 153-167, Summer.
  4. Hourcade, Jean-Charles, 1993. "Modelling long-run scenarios : Methodology lessons from a prospective study on a low CO2 intensive country," Energy Policy, Elsevier, vol. 21(3), pages 309-326, March.
  5. Lecocq, Franck & Hourcade, Jean-Charles & Ha Duong, Minh, 1998. "Decision making under uncertainty and inertia constraints: sectoral implications of the when flexibility," Energy Economics, Elsevier, vol. 20(5-6), pages 539-555, December.
  6. Jean-Charles Hourcade & Philippe Ambrosi & Stéphane Hallegatte & Franck Lecocq & Patrice Dumas & Minh Ha-Duong, 2003. "Optimal control models and elicitation of attitudes towards climate damages," Post-Print halshs-00000966, HAL.
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