by Carlo Carraro, Enrica De Cian and Lea Nicita
- This paper tackles the issues of whether technical change is biased towards the energy sectors, the importance of the elasticity of substitution between factors in determining this bias and how mitigation policy is likely to affect it. The analysis is performed using the World Induced Technical Change model, WITCH. Three different versions of themodel are proposed. The starting set-up includes endogenous technical change only in the energy sector. A second version introduces endogenous technical change in both theenergy and non-energy sectors. A third version of the model embodies different sources of technical change, namely R&D and human capital.
Carraro, C., E. De Cian and L. Nicita (2010). "Modeling Biased Technical Change.Implications for Climate Policy." FEEM Note di lavoro 2010.004, Jan 2010.
