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Is Renewable Energy A Curse or Blessing? Evidence from Solar Power

Author

Listed:
  • Long, Xianling
  • Huang, Kaixing
  • Xu, Shang

Abstract

Employing a spatial equilibrium model and exploiting staggered solar farm installations across Chinese counties, this study reveals that solar energy development reduces local GDP per capita by an average of 2.7\%. This negative effect, primarily from competition for high-value land, is more pronounced in counties with high land opportunity costs. We observe a 2\% increase in the local population despite lower wages and higher housing prices, implying improvements in local amenities. This paper reframes the resource curse debate by examining the impacts of renewable energy, specifically solar power.

Suggested Citation

  • Long, Xianling & Huang, Kaixing & Xu, Shang, 2024. "Is Renewable Energy A Curse or Blessing? Evidence from Solar Power," MPRA Paper 122651, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:122651
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    References listed on IDEAS

    as
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    2. Zhiguo He & Scott T. Nelson & Yang Su & Anthony Lee Zhang & Fudong Zhang, 2022. "Zoning for Profits: How Public Finance Shapes Land Supply in China," NBER Working Papers 30504, National Bureau of Economic Research, Inc.
    3. Michael Alexeev & Robert Conrad, 2009. "The Elusive Curse of Oil," The Review of Economics and Statistics, MIT Press, vol. 91(3), pages 586-598, August.
    4. Hunt Allcott & Daniel Keniston, 2018. "Dutch Disease or Agglomeration? The Local Economic Effects of Natural Resource Booms in Modern America," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 85(2), pages 695-731.
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    Keywords

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    JEL classification:

    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • R14 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Land Use Patterns

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