Energy saving technological progress in overlapping generations economies with renewable and non-renewable resources

Date
2012
Authors
Fazlıoğlu, B. A.
Sağlam, H. Ç.
Advisor
Instructor
Source Title
İktisat İşletme ve Finans
Print ISSN
1300-610X
Electronic ISSN
1308-4658
Publisher
Bilgesel Yayıncılık San. ve Tic. Ltd.
Volume
27
Issue
318
Pages
27 - 56
Language
English
Type
Article
Journal Title
Journal ISSN
Volume Title
Abstract

We study the effects of energy saving technological progress and substitution of renewable energy resources with non-renewable resources on natural resource depletion and long run growth. We develop a growth model in two-period overlapping generations framework incorporating the presence of both renewable and non-renewable energy resources and resource augmenting technological progress. We provide an analytical characterization of the balanced growth path and analyze the conditions for the economy to exhibit positive long run growth. Then, we investigate the effects of discount factor, resource augmenting technological progress and intensity of resources in energy production on the depletion rate. We also examine whether the long run growth is sustainable or optimal. Our main finding is that the effect of an increase in the intensity of the renewable resources in producing energy on long run growth is positive. In addition although exhaustible resources are essential in production the economy can be sustained and the balanced growth path is optimal.

Course
Other identifiers
Book Title
Keywords
Energy saving technological progress, Overlapping generations model, Long-run growth, Optimality, Sustainability
Citation
Published Version (Please cite this version)