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Sectoral Growth Effects of Energy Policies in an Increasing-Varieties Model of the Swiss Economy

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  • Lucas Bretschger
  • Roger Ramer

Abstract

The paper applies a theoretical model with increasing capital varieties to study the impact of energy on growth. It translates a multisectoral framework version to a computable general equilibrium (CGE) model of the Swiss economy. We study the impacts of a policy aiming at enabling the economy to reach the longterm target of a 2000-Watt-society, implying a substantial reduction of the energy input in the future. We find that (i) the aggregate effects of an ambitious energy efficiency policy turn out to be moderate, (ii) all sectors in the economy continue to grow at robust positive rates (although growth rates decrease in some sectors compared to business-as-usual), and (iii) some industries experience substantially higher growth under regulation. We focus on the different sectoral growth effects to simulate future structural change.

Suggested Citation

  • Lucas Bretschger & Roger Ramer, 2012. "Sectoral Growth Effects of Energy Policies in an Increasing-Varieties Model of the Swiss Economy," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 148(II), pages 137-166, June.
  • Handle: RePEc:ses:arsjes:2012-ii-3
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Nicole A. Mathys & Philippe Thalmann & Marc Vielle, 2012. "Modelling Contributions to the Swiss Energy and Environmental Challenge," Swiss Journal of Economics and Statistics (SJES), Swiss Society of Economics and Statistics (SSES), vol. 148(II), pages 97-109, June.
    2. Christos Karydas & Lin Zhang, 2017. "Green tax reform, endogenous innovation and the growth dividend," CER-ETH Economics working paper series 17/266, CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich.
    3. Pattupara, Rajesh & Kannan, Ramachandran, 2016. "Alternative low-carbon electricity pathways in Switzerland and it’s neighbouring countries under a nuclear phase-out scenario," Applied Energy, Elsevier, vol. 172(C), pages 152-168.

    More about this item

    Keywords

    Energy and Growth; CGE model; sectoral growth rates; Swiss data;

    JEL classification:

    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • C63 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computational Techniques
    • O41 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - One, Two, and Multisector Growth Models
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

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