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Annual Review of Economics

Volume 13, 2021

Directed Technical Change in Labor and Environmental Economics

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.

Keyword(s): automation, climate change, directed technical change, endogenous growth, income inequality, JEL E25, JEL J24, JEL O31, JEL O33, JEL O41, JEL O44, JEL Q55
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2021-08-05
2024-04-29
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Directed Technical Change in Labor and Environmental Economics
Annual Review of Economics 13, 571 (2021); https://doi.org/10.1146/annurev-economics-092120-044327
/content/journals/10.1146/annurev-economics-092120-044327
/content/journals/10.1146/annurev-economics-092120-044327
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