Bringing Energy Back Into the Economy: Examining Economic Growth With Energy
M. Shahid Alam
This paper works out some of the basic properties of an economy with energy as a factor of production. The economy now consists of streams of energy conversions that direct energy to the production of goods and services. The focus on energy generates a variety of insights. It yields a new taxonomy of economies and economic activities; allows a better grasp of the tasks performed by labor and capital; raises the prospect of examining growth as the speeding up of machines; and identifies greater use of energy as an important source of growth. In addition, we use these results to explain the near stagnation in living standards in agrarian economies in the millennia before 1800, and the dramatic acceleration in growth since that date.
Number of Pages in PDF File: 26
Keywords: Economy, energy, capital, labor, growth, sources of growth
JEL Classification: B0, N0, O3,O4, Q0, Q4working papers series
Date posted: December 10, 2006 ; Last revised: April 27, 2008
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