Innovation and the macroeconomy

This dissertation studies how innovation and investment decisions affect various
aspects of the macroeconomy, both in terms of real economic activities such as output and resource use, and from the monetary and financial aspects including money demand and monetary policy. The first chapter investigates how directed technical change may stimulate clean innovations and phase out polluting technologies, and highlights the role of self-fulfilling prophecies in the transition towards green growth. The second chapter addresses the interactions between resource-saving innovations and policies that promote a “circular economy” (CE), and analyzes the overall economic impact of CE policies, taking into account their short- and long-term impact on resource-saving innovations. The third chapter turns to the monetary side of the economy, and explores the recent fintech phenomenon of cryptocurrencies. It investigates the demand-side features of cryptocurrencies and their implications for the broader economy.