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Title: Energy and Physical Capital: A Case of Non-classical Dynamics
Authors: Fazlıoğlu, Burcu Afyonoğlu
Perez-Barahona, Agustin
Sağlam, Çağrı
Keywords: Exhaustible energy resources
economic dynamics
overlapping generations
Issue Date: 2019
Publisher: Springer Netherlands
Source: Fazlıoğlu, B. A., Pérez-Barahona, A., & Sağlam, Ç. (2019). Energy and Physical Capital: A Case of Non-classical Dynamics. Environmental and Resource Economics, 72(4), 1003-1022.
Abstract: We study the importance of considering different energy requirements for physical capital and final good production in an overlapping generations (OLG) resource economy. In contrast to the standard OLG framework, but consistently with the empirical evidence, we assume that the accumulation of physical capital requires more energy than the production of consumption goods. Focusing on exhaustible energy resources, we find that OLG equilibria can exhibit non-classical dynamics: the economy generates complex dynamics where, differing from the response predicted by the standard approach, resource prices may not increase monotonically. This result illustrates that the technological assumptions behind the energy inputs should be taken with caution, in particular on dynamic analyses involving exhaustible energy resources.
URI: 10.1007/s10640-018-0236-x
ISSN: 0924-6460
Appears in Collections:Scopus İndeksli Yayınlar Koleksiyonu / Scopus Indexed Publications Collection
Uluslararası Girişimcilik Bölümü / Department of International Entrepreneurship
WoS İndeksli Yayınlar Koleksiyonu / WoS Indexed Publications Collection

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