Directed Technical Change in Labor and Environmental Economics

Posted: 12 Aug 2021

See all articles by David Hémous

David Hémous

University of Zürich; Centre for Economic Policy Research (CEPR)

Morten Olsen

University of Copenhagen

Multiple version iconThere are 3 versions of this paper

Date Written: August 2021

Abstract

It is increasingly evident that the direction of technological change responds to economic incentives. We review the literature on directed technical change in the context of environmental economics and labor economics, and we show that these fields have much in common both theoretically and empirically. We emphasize the importance of a balanced growth path and show that the lack of such a path is closely related to the slow development of green technologies in environmental economics and to growing inequality in labor economics. We discuss whether the direction of innovation is efficient.

Suggested Citation

Hemous, David and Olsen, Morten, Directed Technical Change in Labor and Environmental Economics (August 2021). Annual Review of Economics, Vol. 13, pp. 571-597, 2021, Available at SSRN: https://ssrn.com/abstract=3903111 or http://dx.doi.org/10.1146/annurev-economics-092120-044327

David Hemous (Contact Author)

University of Zürich ( email )

Zürich
Switzerland

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Morten Olsen

University of Copenhagen ( email )

Copenhagen
Copenhagen
Denmark

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