Elasticity of substitution between clean and dirty energy inputs: A macroeconomic perspective

Arbeitspapier

Recently Acemolgu, Aghion, Bursztyn and Hemous (AER 2012) formulated a model in which a high macroeconomic elasticity of substitution between clean and dirty production represents a crucial condition for green growth. Until now it has never been systematically estimated. Using a novel panel of cross-country sectoral data, we formulate specifications of nested CES production functions that allow to estimate a special case of this parameter: the elasticity of substitution between clean and dirty energy inputs. Contrary to what is expected based on the earlier interfuel substitution literature, we find evidence that this elasticity exceeds one.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: ZEW Discussion Papers ; No. 13-087

Classification and Topics

• Classification: Wirtschaft ; Environment and Growth ; Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence ; Climate; Natural Disasters and Their Management; Global Warming ; Environmental Economics: Government Policy
• Subject: clean and dirty energy inputs ; aggregate elasticity of substitution ; CES function ; cross-country sectoral data ; environmental policy

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Papageorgiou, Chris ; Saam, Marianne ; Schulte, Patrick
• Event: Veröffentlichung
• (who): Zentrum für Europäische Wirtschaftsforschung (ZEW)
• (where): Mannheim
• (when): 2013

Further information

• Handle: http://hdl.handle.net/10419/88124
• URN: urn:nbn:de:bsz:180-madoc-352093
• Last update: 10.03.2025, 11:42 AM CET