Energy-saving technical change

Hassler, John, Krusell, Per and Olovsson, Conny (2015) Energy-saving technical change. CFM discussion paper series (CFM-DP2015-29). Centre For Macroeconomics, London, UK.

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Abstract

We estimate an aggregate production function with constant elasticity of substitution between energy and a capital/labor composite using U.S. data. The implied measure of energysaving technical change appears to respond strongly to the oilprice shocks in the 1970s and has a negative medium-run correlation with capital/labor-saving technical change. Our findings are suggestive of a model of directed technical change, with low short-run substitutability between energy and capital/labor but significant substitutability over longer periods through technical change. We construct such a model, calibrate it based on the historical data, and use it to discuss possibilities for the future

Item Type:	Monograph (Discussion Paper)
Official URL:	http://www.centreformacroeconomics.ac.uk/Home.aspx
Additional Information:	© 2015 The Authors
Divisions:	Centre for Macroeconomics
Subjects:	H Social Sciences > HB Economic Theory
Date Deposited:	14 Dec 2017 09:28
Last Modified:	13 Sep 2024 20:33
URI:	http://eprints.lse.ac.uk/id/eprint/86280

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