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Endogenizing Technological Change: Matching Empirical Evidence to Modeling Needs

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  • Pizer, William A.

    () (Resources for the Future)

  • Popp, David

Abstract

Technologies to reduce significantly fossil-fuel emissions currently are unavailable or only available at high cost. In light of this, the amount of research on the pace, direction, and benefits of environmentally friendly technological change has grown dramatically in recent years. This research includes empirical estimates of these effects and modeling exercises designed to simulate endogenous technological change in response to climate policy. Unfortunately, few attempts have been made to connect these two streams of research. This paper attempts to bridge that gap, reviewing both the empirical and modeling literature on technological change. Our goal is to provide an agenda for how both empirical and modeling research in these areas can move forward in a complementary fashion. In doing so, we discuss how models used for policy evaluation can better capture empirical phenomena and how empirical research can better address the needs of models used for policy evaluation.

Suggested Citation

  • Pizer, William A. & Popp, David, 2007. "Endogenizing Technological Change: Matching Empirical Evidence to Modeling Needs," Discussion Papers dp-07-11, Resources For the Future.
  • Handle: RePEc:rff:dpaper:dp-07-11
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    Keywords

    endogenous technological change; climate change; CGE modeling;

    JEL classification:

    • Q55 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Technological Innovation
    • Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy
    • O3 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights
    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models

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