Economic growth and choice of energy: A simplistic strategic approach

Jacob Engwerda, T. Michalak

Research output: Contribution to journalArticleScientificpeer-review

Abstract

In this paper, we present a simplistic dynamic model to analyze the tradeoff between the use of environment-friendly energy and the use of environment-polluting energy in a dynamic world characterized by players that have different interests. Our approach builds upon a neoclassical growth model, integrating different economies, and including pollution as a separate growth factor. The model is cast in a differential game framework with the open-loop information structure. In this setting, we analyze the impact of pollution over time on the fossil fuel/“green” energy ratio. Furthermore, based on a simulation study for the linearized model, we consider the question whether certain cooperative arrangements between countries having different interests can be expected in case pollution shocks occur.
Original languageEnglish
Pages (from-to)321-342
JournalEnvironmental Modeling and Assessment
Volume20
Issue number4
DOIs
Publication statusPublished - Aug 2015

Fingerprint

strategic approach
economic growth
pollution
energy
fossil fuel
simulation

Keywords

  • climate change
  • economic growth
  • dynamic games
  • green versus fossil energy

Cite this

Engwerda, Jacob ; Michalak, T. / Economic growth and choice of energy : A simplistic strategic approach. In: Environmental Modeling and Assessment. 2015 ; Vol. 20, No. 4. pp. 321-342.
@article{129cac4307d74076ae8b459391f2b97f,
title = "Economic growth and choice of energy: A simplistic strategic approach",
abstract = "In this paper, we present a simplistic dynamic model to analyze the tradeoff between the use of environment-friendly energy and the use of environment-polluting energy in a dynamic world characterized by players that have different interests. Our approach builds upon a neoclassical growth model, integrating different economies, and including pollution as a separate growth factor. The model is cast in a differential game framework with the open-loop information structure. In this setting, we analyze the impact of pollution over time on the fossil fuel/“green” energy ratio. Furthermore, based on a simulation study for the linearized model, we consider the question whether certain cooperative arrangements between countries having different interests can be expected in case pollution shocks occur.",
keywords = "climate change, economic growth, dynamic games, green versus fossil energy",
author = "Jacob Engwerda and T. Michalak",
year = "2015",
month = "8",
doi = "10.1007/s10666-014-9431-5",
language = "English",
volume = "20",
pages = "321--342",
journal = "Environmental Modeling and Assessment",
issn = "1420-2026",
publisher = "Springer Netherlands",
number = "4",

}

Economic growth and choice of energy : A simplistic strategic approach. / Engwerda, Jacob; Michalak, T.

In: Environmental Modeling and Assessment, Vol. 20, No. 4, 08.2015, p. 321-342.

Research output: Contribution to journalArticleScientificpeer-review

TY - JOUR

T1 - Economic growth and choice of energy

T2 - A simplistic strategic approach

AU - Engwerda, Jacob

AU - Michalak, T.

PY - 2015/8

Y1 - 2015/8

N2 - In this paper, we present a simplistic dynamic model to analyze the tradeoff between the use of environment-friendly energy and the use of environment-polluting energy in a dynamic world characterized by players that have different interests. Our approach builds upon a neoclassical growth model, integrating different economies, and including pollution as a separate growth factor. The model is cast in a differential game framework with the open-loop information structure. In this setting, we analyze the impact of pollution over time on the fossil fuel/“green” energy ratio. Furthermore, based on a simulation study for the linearized model, we consider the question whether certain cooperative arrangements between countries having different interests can be expected in case pollution shocks occur.

AB - In this paper, we present a simplistic dynamic model to analyze the tradeoff between the use of environment-friendly energy and the use of environment-polluting energy in a dynamic world characterized by players that have different interests. Our approach builds upon a neoclassical growth model, integrating different economies, and including pollution as a separate growth factor. The model is cast in a differential game framework with the open-loop information structure. In this setting, we analyze the impact of pollution over time on the fossil fuel/“green” energy ratio. Furthermore, based on a simulation study for the linearized model, we consider the question whether certain cooperative arrangements between countries having different interests can be expected in case pollution shocks occur.

KW - climate change

KW - economic growth

KW - dynamic games

KW - green versus fossil energy

U2 - 10.1007/s10666-014-9431-5

DO - 10.1007/s10666-014-9431-5

M3 - Article

VL - 20

SP - 321

EP - 342

JO - Environmental Modeling and Assessment

JF - Environmental Modeling and Assessment

SN - 1420-2026

IS - 4

ER -