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Learning by Doing with Constrained Growth Rates and Application to Energy Technology Policy

Author

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  • Karsten Neuhoff

Abstract

Learning by doing methodology attributes cost reductions of a technology to cumulative investment and experience. This paper argues that in addition market growth rates must also be considered. Historically growth rates have been limited in most sectors, thus allowing for feedback in the learning process. When market growth is below the ÔoptimalÕ rate, the marginal value of additional investment could be a multiple of the direct learning benefit. Analytic and numeric models quantify this impact Ð emphasizing the need for tailored technology policy in addition to carbon pricing. Implications for the modeling of endogenous technological change are discussed.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Karsten Neuhoff, 2008. "Learning by Doing with Constrained Growth Rates and Application to Energy Technology Policy," Working Papers EPRG 0809, Energy Policy Research Group, Cambridge Judge Business School, University of Cambridge.
    • Handle: RePEc:enp:wpaper:eprg0809
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    Cited by:

    1. Lehmann, Paul, 2013. "Supplementing an emissions tax by a feed-in tariff for renewable electricity to address learning spillovers," Energy Policy, Elsevier, vol. 61(C), pages 635-641.
    2. Green, Richard & Léautier, Thomas-Olivier, 2015. "Do costs fall faster than revenues? Dynamics of renewables entry into electricity markets," TSE Working Papers 15-591, Toulouse School of Economics (TSE).
    3. Rai, Varun & Victor, David G. & Thurber, Mark C., 2010. "Carbon capture and storage at scale: Lessons from the growth of analogous energy technologies," Energy Policy, Elsevier, vol. 38(8), pages 4089-4098, August.
    4. Maria Rosario Garzón Sampedro & Carlos Sanchez Gonzalez, 2016. "Spanish photovoltaic learning curve," International Journal of Low-Carbon Technologies, Oxford University Press, vol. 11(2), pages 177-183.
    5. Newbery, David, 2018. "Evaluating the case for supporting renewable electricity," Energy Policy, Elsevier, vol. 120(C), pages 684-696.
    6. Wand, Robert & Leuthold, Florian, 2011. "Feed-in tariffs for photovoltaics: Learning by doing in Germany?," Applied Energy, Elsevier, vol. 88(12), pages 4387-4399.
    7. Felix Groba & Barbara Breitschopf, 2013. "Impact of Renewable Energy Policy and Use on Innovation: A Literature Review," Discussion Papers of DIW Berlin 1318, DIW Berlin, German Institute for Economic Research.
    8. Sato, Misato & Rafaty, Ryan & Calel, Raphael & Grubb, Michael, 2022. "Allocation, allocation, allocation! The political economy of the development of the European Union Emissions Trading System," LSE Research Online Documents on Economics 115431, London School of Economics and Political Science, LSE Library.

    More about this item

    Keywords

    Learning-by-doing; growth rate; technology policy; welfare analysis;
    All these keywords.

    JEL classification:

    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives

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