TY - JOUR
T1 - Directed technological change in a Post-Keynesian Ecological Macromodel
AU - Naqvi, Asjad
AU - Stockhammer, Engelbert
N1 - This work was supported by the Oesterreichische Nationalbanks (Austrian Central Bank) Anniversary Fund [grant number: 17400].
PY - 2018/12/1
Y1 - 2018/12/1
N2 - This paper presents a post-Keynesian ecological macromodel, which is stock-flow consistent, and incorporates directed technological change. Private and public R&D spending across three competing, yet complementary inputs – Labor, Capital, and Resources – follow a portfolio allocation decision, where inputs with relatively higher growth in costs, see higher R&D investment and productivity gains. Two policy experiments are reported; a market-based Resource tax increase, and a centralized green policy, where public R&D budget is shifted towards Resource-saving technologies. We highlight that in the presence of labor market institutions, which give rise to hysteresis, and limited R&D budgets, a policy of continuous Resource tax growth is needed to induce Resource-saving technological change to achieve a greener economy. This needs to be coupled with planned government spending adjustment to spur demand and boost investment. The findings also suggest that a mix of market-based and centralized policies may be optimal
AB - This paper presents a post-Keynesian ecological macromodel, which is stock-flow consistent, and incorporates directed technological change. Private and public R&D spending across three competing, yet complementary inputs – Labor, Capital, and Resources – follow a portfolio allocation decision, where inputs with relatively higher growth in costs, see higher R&D investment and productivity gains. Two policy experiments are reported; a market-based Resource tax increase, and a centralized green policy, where public R&D budget is shifted towards Resource-saving technologies. We highlight that in the presence of labor market institutions, which give rise to hysteresis, and limited R&D budgets, a policy of continuous Resource tax growth is needed to induce Resource-saving technological change to achieve a greener economy. This needs to be coupled with planned government spending adjustment to spur demand and boost investment. The findings also suggest that a mix of market-based and centralized policies may be optimal
U2 - 10.1016/j.ecolecon.2018.07.008
DO - 10.1016/j.ecolecon.2018.07.008
M3 - Article
SN - 0921-8009
VL - 154
SP - 168
EP - 188
JO - ECOLOGICAL ECONOMICS
JF - ECOLOGICAL ECONOMICS
ER -
