Competing Land Uses and Fossil Fuel, Optimal Energy Conversion Rates During the Transition Toward a Green Economy Under a Pollution Stock Constraint

Amigues, Jean-Pierre and Moreaux, Michel (2018) Competing Land Uses and Fossil Fuel, Optimal Energy Conversion Rates During the Transition Toward a Green Economy Under a Pollution Stock Constraint. TSE Working Paper, n. 18-981, Toulouse

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Official URL: http://tse-fr.eu/pub/33165

Abstract

We study the transition to a carbon-free economy in a model with a polluting non-renewable resource and a clean renewable resource. Transforming primary energy into ready-to-use energy services is costly and more efficient energy transformation rates are more costly to achieve. Renewable energy competes with food production for land and the food productivity of land can be improved at some cost. To avoid catastrophic climate damages, the pollution stock is mandated to stay below a given cap. When the economy is not constrained by the cap, the efficiency of energy transformation increases steadily until the transition toward the ultimate green economy; when renewable energy is exploited, its land use rises at the expense of food production; food productivity increases together with the land rent but food production drops; the food and energy prices increase and renewables substitute for non-renewable energy. During the constrained phase, the economy follows a constant path of prices, quantities, efficiency rates, food productivity and land rent, a phenomenon we call the ’ceiling efficiency paradox'.

Item Type: Monograph (Working Paper)
Language: English
Date: December 2018
Place of Publication: Toulouse
JEL codes: Q00 - General
Q32 - Exhaustible Resources and Economic Development
Q43 - Energy and the Macroeconomy
Q54 - Climate; Natural Disasters
Subjects: B- ECONOMIE ET FINANCE
Divisions: TSE-R (Toulouse)
Institution: Université Toulouse Capitole
Site: UT1
Date Deposited: 21 Dec 2018 10:13
Last Modified: 21 Dec 2018 10:13
OAI ID: oai:tse-fr.eu:33165
URI: http://publications.ut-capitole.fr/id/eprint/28413

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