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A CGE-Analysis of Energy Policies Considering Labor Market Imperfections and Technology Specifications

Author

Listed:
  • Robert Küster

    (Universität Stuttgart)

  • ingo Ellersdorfer

    (Universität Stuttgart)

  • Ulrich Fahl

    (Universität Stuttgart)

Abstract

The paper establishes a CGE/MPSGE model for evaluating energy policy measures with emphasis on their employment impacts. It specifies a dual labor market with respect to qualification, two different mechanisms for skill specific unemployment, and a technology detailed description of electricity generation. Non clearing of the dual labor market is modeled via minimum wage constraints and via wage curves. The model is exemplarily applied for the analysis of capital subsidies on the application of technologies using renewable energy sources. Quantitative results highlight that subsidies on these technologies do not automatically lead to a significant reduction in emissions. Moreover, if emission reductions are achieved these might actually partly result from negative growth effects induced by the promotion of cost inefficient technologies. Inefficiencies in the energy system increase unemployment for both skilled and unskilled labor.

Suggested Citation

  • Robert Küster & ingo Ellersdorfer & Ulrich Fahl, 2007. "A CGE-Analysis of Energy Policies Considering Labor Market Imperfections and Technology Specifications," Working Papers 2007.7, Fondazione Eni Enrico Mattei.
  • Handle: RePEc:fem:femwpa:2007.7
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    File URL: http://www.feem.it/userfiles/attach/Publication/NDL2007/NDL2007-007.pdf
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    References listed on IDEAS

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    Cited by:

    1. Randall Jackson & Péter Járosi & Amir B. Ferreira Neto & Elham Erfanian, 2017. "Woody Biomass Processing and Rural Regional Development," Working Papers Working Paper 2017-01, Regional Research Institute, West Virginia University.
    2. Muritala Taiwo Adewale & Awolaja Ayodeji Muyideen & James Olurotimi, 2013. "Impact of Climate Change on Employment in Nigeria," Acta Universitatis Danubius. OEconomica, Danubius University of Galati, issue 9(3), pages 153-161, June.
    3. Ignacio Cazcarro & Rosa Duarte & Julio Sánchez Chóliz & Cristina Sarasa & Ana Serrano, 2016. "Modelling regional policy scenarios in the agri-food sector: a case study of a Spanish region," Applied Economics, Taylor & Francis Journals, vol. 48(16), pages 1463-1480, April.
    4. Duarte, Rosa & Feng, Kuishuang & Hubacek, Klaus & Sánchez-Chóliz, Julio & Sarasa, Cristina & Sun, Laixiang, 2016. "Modeling the carbon consequences of pro-environmental consumer behavior," Applied Energy, Elsevier, pages 1207-1216.
    5. Trink, Thomas & Schmid, Christoph & Schinko, Thomas & Steininger, Karl W. & Loibnegger, Thomas & Kettner, Claudia & Pack, Alexandra & Töglhofer, Christoph, 2010. "Regional economic impacts of biomass based energy service use: A comparison across crops and technologies for East Styria, Austria," Energy Policy, Elsevier, vol. 38(10), pages 5912-5926, October.
    6. Shiro Takeda & Toshi H. Arimura & Makoto Sugino, 2015. "Labor Market Distortions and Welfare-Decreasing International Emissions Trading," Working Papers 1422, Waseda University, Faculty of Political Science and Economics.
    7. Rivers, Nicholas, 2013. "Renewable energy and unemployment: A general equilibrium analysis," Resource and Energy Economics, Elsevier, vol. 35(4), pages 467-485.
    8. Kitwiwattanachai, Anyarath & Nelson, Doug & Reed, Geoffrey, 2010. "Quantitative impacts of alternative East Asia Free Trade Areas: A Computable General Equilibrium (CGE) assessment," Journal of Policy Modeling, Elsevier, vol. 32(2), pages 286-301, March.
    9. Kiula, Olga & Markandya, Anil & Ščasný, Milan & Menkyna Tsuchimoto, Fusako, 2014. "The Economic and Environmental Effects of Taxing Air Pollutants and CO2: Lessons from a Study of the Czech Republic," MPRA Paper 66599, University Library of Munich, Germany, revised Oct 2015.

    More about this item

    Keywords

    CGE; Energy Economic Analysis; Employment Impact; Choice of Technology;

    JEL classification:

    • 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
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • Q52 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Pollution Control Adoption and Costs; Distributional Effects; Employment Effects

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