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Long-run substitutability between fossil and renewable energy: global evidence 1800–2012

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  • H. Schwerin

    (University of Kent)

Abstract

This paper analyzes the economywide elasticity of substitution between fossil and renewable energy carriers using demand behavior based on longitudinal data 1800–2012. Estimates are yielded by relative price and relative quantity and show gross substitutability between energy carriers, with the central estimate being 4.33. The standard errors of the coefficient estimates of the orthogonal regression are derived using a generalized method of moments.

Suggested Citation

  • H. Schwerin, 2025. "Long-run substitutability between fossil and renewable energy: global evidence 1800–2012," Empirical Economics, Springer, vol. 69(1), pages 129-148, July.
    • Handle: RePEc:spr:empeco:v:69:y:2025:i:1:d:10.1007_s00181-025-02739-8
    DOI: 10.1007/s00181-025-02739-8
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    References listed on IDEAS

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    1. Malikov, Emir & Sun, Kai & Kumbhakar, Subal C., 2018. "Nonparametric estimates of the clean and dirty energy substitutability," Economics Letters, Elsevier, vol. 168(C), pages 118-122.
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    5. Chris Papageorgiou & Marianne Saam & Patrick Schulte, 2017. "Substitution between Clean and Dirty Energy Inputs: A Macroeconomic Perspective," The Review of Economics and Statistics, MIT Press, vol. 99(2), pages 281-290, May.
    6. Hassler, John & Krusell, Per & Olovsson, Conny, 2022. "Finite resources and the world economy," Journal of International Economics, Elsevier, vol. 136(C).
    7. Anthony Wiskich, 2019. "Decreasing Substitutability Between Clean and Dirty Energy," CAMA Working Papers 2019-72, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.
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    Keywords

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    JEL classification:

    • C20 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - General
    • N70 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - General, International, or Comparative
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

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