In this article, we analyze the transition dynamics, what Hicks called the traverse, from one equilibrium toward another one—and the conditions for such a transfer—in a bi-sectoral economy under technological shocks.
To this end, we revisit the Hick Traverse model and add to it intersectoral relations in the form of intersectoral consumption of energy for both the energy and the manufacturing sector. We investigate two distinct assumptions about consumption behavior of manufactured goods. We show that our model extends Hicks’ one and leads to the same condition for a good traverse path, independently from the net energy return. We highlight that energy production technologies nevertheless provide constrains on viable states of the economy and its maximal growth rate, and that energy consumption technologies impact investment and prices crucially.
Adrien Nguyen-Huu (Université de Montpellier) et Antonin Pottier (EHESS) sont chercheurs associés à la Chaire Energie et Prospérité.
Recent recovery plans, associated with the COVID‐19 pandemic and the energy transition, increased the funding available to finance innovative low‐carbon projects and called for an economic evaluation of their allocation. This paper analyzes the potential benefit of using repayable advance: a lump‐sum payment to finance the project that is paid back in case of...
The Chairs Armand Peugeot, Energy and Prosperity, and Climate Economics are organizing, on December 6th an 7th, 2023, the 10th edition of the annual international Conference on Mobility Challenges.