Directed Technological Change in a post-Keynesian Ecological Macromodel

Naqvi, Syed Ali Asjad and Engelbert, Stockhammer (2017) Directed Technological Change in a post-Keynesian Ecological Macromodel. Ecological Economic Papers, 16. WU Vienna University of Economics and Business, Vienna.

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Abstract

This paper presents a post-Keynesian ecological macro model that combines three strands of literature: the directed technological change mechanism developed in mainstream endogenous growth theory models, the ecological economic literature which highlights the role of green innovation and material flows, and the post-Keynesian school which provides a framework to deal with the demand side of the economy, financial flows, and inter- and intra-sectoral behavioral interactions. The model is stock-flow consistent and introduces research and development (R&D) as a component of GDP funded by private firm investment and public expenditure. The economy uses three complimentary inputs - Labor, Capital, and (non-renewable) Resources. Input productivities depend on R&D expenditures, which are determined by relative changes in their respective prices. Two policy experiments are tested; a Resource tax increase, and an increase in the share of public R&D on Resources. Model results show that policy instruments that are continually increased over a long-time horizon have better chances of achieving a "green" transition than one-of climate policy shocks to the system, that primarily have a short-run affect.

Item Type:	Paper
Additional Information:	The paper has been generously supported by funds of the Oesterreichische Nationalbank (Austrias central bank, Anniversary Fund, project number: 17400).
Keywords:	directed technological change, research and development, green transition, ecological economics, post-Keynesian economics, stock-flow consistency
Divisions:	Departments > Sozioökonomie > Ecological Economics
Depositing User:	Karin Lagger
Date Deposited:	13 Oct 2017 07:59
Last Modified:	22 Oct 2019 00:41
FIDES Link:	https://bach.wu.ac.at/d/research/results/83492/
URI:	https://epub.wu.ac.at/id/eprint/5809

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