Directed technical change, environmental sustainability, and population growth

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Population growth has two potentially counteracting effects on pollution emissions: (i) more people imply more production and thereby more emissions, and (ii) more people imply a larger research capacity which might reduce the emission intensity of production, depending on the direction of research. This study investigates how to achieve a given climate goal in the presence of these two effects. A growth model featuring both directed technical change and population growth is developed. The model allows for simultaneous research in polluting and non-polluting technologies. Both analytical and numerical results indicate that population growth is a burden on the environment, even when all research efforts are directed toward non-polluting technologies. Thus, research subsidies alone cannot ensure environmental sustainability. Instead, the analysis highlights the importance of carbon taxes for climate change mitigation.

TidsskriftJournal of Environmental Economics and Management
Antal sider24
StatusUdgivet - okt. 2023

Bibliografisk note

Funding Information:
I would like to thank Christian Groth, John Hassler, Charles I. Jones, Peter Birch Sørensen, Mads Greaker, Inge van den Bijgaart, Gregory Casey, Carl-Johan Dalgaard, Rob Hart, Peter E. Madsen, August Nielsen, Conny Olovsson, Rick van der Ploeg, Armon Rezai, Gabriel Züllig, and Sjak Smulders as well as seminar participants at the University of Copenhagen, the Danish Environmental Economic Conference 2016, the DGPE workshop 2016, ISEFI-2017, EAERE-2017, the 2017 EAERE-FEEM-VIU European Summer School in Resource and Environmental Economics, SURED-2018, the International Workshop on Climate Change Economics at the University of Copenhagen 2018, the NAERE Workshop 2019, and the OsloMet 2020 for useful comments, suggestions, and discussions. I also thank the editor and two anonymous referees for constructive comments that helped improve the article. This article is a revised version of Kruse-Andersen (2018, ch. 3). Any remaining errors are my own.

Publisher Copyright:
© 2023 The Author(s)

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