Economics of Endogenous Technical Change in CGE Models - The Role of Gains from Specialization
Computable general equilibrium models simulate the reaction of industries on carbon taxes. Their results differ strongly on the assumption of the underlying technologies. This paper compares two models and emphasizes the differences between their approaches to technology. The first model is the CITE model, which is the first model with endogenous growth based on gains from specialization so that growth dynamics result from investment incentives. The second model is a model with exogenous growth of endowments, which is the basis for many other CGE models. The results show that the CITE model unveils dynamics that cannot be obtained with the model based on exogenous growth. Reactions are stronger in the CITE model and industries need more time to approach the new balanced growth path.
|Date of creation:||Jun 2010|
|Date of revision:|
|Contact details of provider:|| Postal: |
Phone: +41 44 632 03 87
Fax: +41 44 632 13 62
Web page: http://www.cer.ethz.ch
More information through EDIRC
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.:
- Stephen C Peck & Thomas J. Teisberg, 1992. "CETA: A Model for Carbon Emissions Trajectory Assessment," The Energy Journal, International Association for Energy Economics, vol. 0(Number 1), pages 55-78.
- Romer, Paul M, 1987. "Growth Based on Increasing Returns Due to Specialization," American Economic Review, American Economic Association, vol. 77(2), pages 56-62, May.
- Goulder, Lawrence H. & Schneider, Stephen H., 1999. "Induced technological change and the attractiveness of CO2 abatement policies," Resource and Energy Economics, Elsevier, vol. 21(3-4), pages 211-253, August.
- Paolo Buonanno & Carlo Carraro & Efrem Castelnuovo & Marzio Galeotti, 2001.
"Emission Trading Restrictions with Endogenous Technological Change,"
International Environmental Agreements: Politics, Law and Economics,
Springer, vol. 1(3), pages 379-395, July.
- Buonanno, Paolo & Carraro, Carlo & Castelnuovo, Efrem & Galeotti, Marzio, 2000. "Emission Trading Restrictions with Endogenous Technological Change," CEPR Discussion Papers 2514, C.E.P.R. Discussion Papers.
- Dixit, Avinash K & Stiglitz, Joseph E, 1975.
"Monopolistic Competition and Optimum Product Diversity,"
The Warwick Economics Research Paper Series (TWERPS)
64, University of Warwick, Department of Economics.
- Dixit, Avinash K & Stiglitz, Joseph E, 1977. "Monopolistic Competition and Optimum Product Diversity," American Economic Review, American Economic Association, vol. 67(3), pages 297-308, June.
- Goulder, Lawrence H. & Mathai, Koshy, 2000. "Optimal CO2 Abatement in the Presence of Induced Technological Change," Journal of Environmental Economics and Management, Elsevier, vol. 39(1), pages 1-38, January.
- Popp, David, 2004. "ENTICE: endogenous technological change in the DICE model of global warming," Journal of Environmental Economics and Management, Elsevier, vol. 48(1), pages 742-768, July.
- Buonanno, Paolo & Carraro, Carlo & Galeotti, Marzio, 2003. "Endogenous induced technical change and the costs of Kyoto," Resource and Energy Economics, Elsevier, vol. 25(1), pages 11-34, February.
- Löschel, Andreas, 2001.
"Technological change in economic models of environmental policy: a survey,"
ZEW Discussion Papers
01-62, ZEW - Zentrum für Europäische Wirtschaftsforschung / Center for European Economic Research.
- Loschel, Andreas, 2002. "Technological change in economic models of environmental policy: a survey," Ecological Economics, Elsevier, vol. 43(2-3), pages 105-126, December.
- Furman, Jeffrey L. & Porter, Michael E. & Stern, Scott, 2002. "The determinants of national innovative capacity," Research Policy, Elsevier, vol. 31(6), pages 899-933, August.
- Jorge Niosi, 2008. "Technology, Development and Innovation Systems: An Introduction," Journal of Development Studies, Taylor & Francis Journals, vol. 44(5), pages 613-621.
- Sandilands, Roger J., 2000. "Perspectives on Allyn Young in Theories of Endogenous Growth," Journal of the History of Economic Thought, Cambridge University Press, vol. 22(03), pages 309-328, September.
- Ethier, Wilfred J, 1982. "National and International Returns to Scale in the Modern Theory of International Trade," American Economic Review, American Economic Association, vol. 72(3), pages 389-405, June.
- Boyd, Roy & Uri, Noel D., 1991. "An assessment of the impacts of energy taxes," Resources and Energy, Elsevier, vol. 13(4), pages 349-379, December.
- Gerlagh, Reyer, 2007. "Measuring the value of induced technological change," Energy Policy, Elsevier, vol. 35(11), pages 5287-5297, November.
- Sabine Messner, 1997. "Endogenized technological learning in an energy systems model," Journal of Evolutionary Economics, Springer, vol. 7(3), pages 291-313.
- Reyer Gerlagh & Bob van der Zwaan & Marjan Hofkes & Ger Klaassen, 2004. "Impacts of CO 2-Taxes in an Economy with Niche Markets and Learning-by-Doing," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 28(3), pages 367-394, July.
When requesting a correction, please mention this item's handle: RePEc:eth:wpswif:10-130. 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: ()
If references are entirely missing, you can add them using this form.