On technical change in the elasticities of resource inputs
This article analyses growth of an economy where the substitutability between non-renewable and renewable resource inputs changes over time. We allow for exogenous technical change in the elasticity of substitution (EoS) between these two types of resources as well as for biased factor-augmenting technical change. Our main results are: (1) sustained technical change in the EoS is enough to overcome resource constraints; (2) productivity-enhancing technical change is most beneficial when directed to the resource which is currently most important for production; (3) the speed of productivity-enhancing technical change is crucial for its usefulness to overcome resource constraints; (4) sustainability depends critically on the type of technical change.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- R. M. Solow, 1974. "Intergenerational Equity and Exhaustible Resources," Review of Economic Studies, Oxford University Press, vol. 41(5), pages 29-45.
- Lucas Bretschger, 2003.
"Economics of technological change and the natural environment: how effective are innovations as a remedy for resource scarcity?,"
CER-ETH Economics working paper series
03/27, CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich, revised Jun 2004.
- Bretschger, Lucas, 2005. "Economics of technological change and the natural environment: How effective are innovations as a remedy for resource scarcity?," Ecological Economics, Elsevier, vol. 54(2-3), pages 148-163, August.
- Groth, C. & Schou, P., 2000.
"Can Nonrenewable Resources Alleviate the Knife-Edge Character of Endogenous Growth,"
00-02, Carleton - School of Public Administration.
- Christian Groth & Poul Schou, 2002. "Can non-renewable resources alleviate the knife-edge character of endogenous growth?," Oxford Economic Papers, Oxford University Press, vol. 54(3), pages 386-411, July.
- Christian Groth & Poul Schou, 2000. "Can Nonrenewable Resources Alleviate the Knife-edge Character of Endogenous Growth," Discussion Papers 00-02, University of Copenhagen. Department of Economics.
- Christian Groth, 2000. "Can Nonrenewable Resources Alleviate the Knife-edge Character of Endogenous Growth?," Econometric Society World Congress 2000 Contributed Papers 1480, Econometric Society.
- Christian Scholz & Georg Ziemes, 1999. "Exhaustible Resources, Monopolistic Competition, and Endogenous Growth," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 13(2), pages 169-185, March.
- de La Grandville, Olivier, 1989. "Erratum [In Quest of the Slutsky Diamond]," American Economic Review, American Economic Association, vol. 79(5), pages 1307, December.
- Groth Christian, 2004.
"Strictly Endogenous Growth with Non-renewable Resources Implies an Unbounded Growth Rate,"
The B.E. Journal of Macroeconomics,
De Gruyter, vol. 4(1), pages 1-15, May.
- Christian Groth, 2003. "Strictly Endogenous Growth with Non-renewable Resources Implies an Unbounded Growth Rate," EPRU Working Paper Series 03-20, Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics.
- Cleveland, Cutler J. & Ruth, Matthias, 1997. "When, where, and by how much do biophysical limits constrain the economic process?: A survey of Nicholas Georgescu-Roegen's contribution to ecological economics," Ecological Economics, Elsevier, vol. 22(3), pages 203-223, September.
- Daron Acemoglu, 2003.
"Labor- And Capital-Augmenting Technical Change,"
Journal of the European Economic Association,
MIT Press, vol. 1(1), pages 1-37, 03.
- Yuhn, Ky-hyang, 1991. "Economic Growth, Technical Change Biases, and the Elasticity of Substitution: A Test of the De La Grandville Hypothesis," The Review of Economics and Statistics, MIT Press, vol. 73(2), pages 340-46, May.
- Grimaud, André & Rougé, Luc, 2003.
"Polluting Non-Renewable Resources, Innovation and Growth : Welfare and Environmental Policy,"
IDEI Working Papers
206, Institut d'Économie Industrielle (IDEI), Toulouse.
- Grimaud, Andre & Rouge, Luc, 2005. "Polluting non-renewable resources, innovation and growth: welfare and environmental policy," Resource and Energy Economics, Elsevier, vol. 27(2), pages 109-129, June.
- Poul Schou, 2000. "Polluting Non-Renewable Resources and Growth," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 16(2), pages 211-227, June.
- Heal, G., 1990.
"The Optimal Use Of Exhaustible Resources,"
fb-_90-10, Columbia - Graduate School of Business.
- Paul Romer, 1989.
"Endogenous Technological Change,"
NBER Working Papers
3210, National Bureau of Economic Research, Inc.
- Kaz Miyagiwa & Chris Papageorgiou, 2007.
"Endogenous Aggregate Elasticity of Substitution,"
0707, Department of Economics, Emory University (Atlanta).
- de La Grandville, Olivier, 1989. "In Quest of the Slutsky Diamond," American Economic Review, American Economic Association, vol. 79(3), pages 468-81, June.
- Jakub, GROWIEC & Ingmar, SCHUMACHER, 2006.
"On Technical Change in the Elasticities of Resource Inputs,"
Discussion Papers (ECON - Département des Sciences Economiques)
2006031, Université catholique de Louvain, Département des Sciences Economiques.
- Growiec, Jakub & Schumacher, Ingmar, 2008. "On technical change in the elasticities of resource inputs," Resources Policy, Elsevier, vol. 33(4), pages 210-221, December.
- GROWIEC, Jakub & SCHUMACHER, Ingmar, 2006. "On technical change in the elasticities of resource inputs," CORE Discussion Papers 2006063, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Andre, Francisco J. & Cerda, Emilio, 2005.
"On natural resource substitution,"
Elsevier, vol. 30(4), pages 233-246, December.
- Francisco J. André & Emilio Cerdá, 2004. "On natural resource substitution," Economic Working Papers at Centro de Estudios Andaluces E2004/48, Centro de Estudios Andaluces.
- Klump, Rainer & Preissler, Harald, 2000. " CES Production Functions and Economic Growth," Scandinavian Journal of Economics, Wiley Blackwell, vol. 102(1), pages 41-56, March.
- Jean-Pierre Amigues & Michel Moreaux & Francesco Ricci, 2006.
"Overcoming the natural resource constraint through dedicated R&D effort with heterogenous labor supply,"
THEMA Working Papers
2006-16, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
- AMIGUES Jean-Pierre & MOREAUX Michel & RICCI Francesco, 2006. "Overcoming the Natural Resource Constraint Through Dedicated R&D Effort with Heterogenous Labor Supply," LERNA Working Papers 06.22.215, LERNA, University of Toulouse.
When requesting a correction, please mention this item's handle: RePEc:eee:jrpoli:v:33:y:2008:i:4:p:210-221. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)
If references are entirely missing, you can add them using this form.