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Environmental Macroeconomics: Environmental Policy, Business Cycles, and Directed Technical Change

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  • Carolyn Fischer

    (Resources for the Future, Washington, DC 20036)

  • Garth Heutel

    (Department of Economics, University of North Carolina, Greensboro, North Carolina 27402
    National Bureau of Economic Research, Cambridge, Massachusetts 02138)

Abstract

Environmental economics has traditionally fallen in the domain of microeconomics, but approaches from macroeconomics have recently been applied to studying environmental policy. We focus on two macroeconomic tools and their application to environmental economics. First, real-business-cycle models can incorporate pollution and pollution policy and can be used to answer several questions. For example, how should environmental policy adjust to business cycles? How do different types of policies fare in a context with business cycles? Second, endogenous technological growth is an important component of environmental policy. Several studies ask how policy can be designed both to tackle emissions directly and to influence the adoption of clean technologies. We focus on these two aspects of environmental macroeconomics but emphasize that there are many other potential applications.

Suggested Citation

  • Carolyn Fischer & Garth Heutel, 2013. "Environmental Macroeconomics: Environmental Policy, Business Cycles, and Directed Technical Change," Annual Review of Resource Economics, Annual Reviews, vol. 5(1), pages 197-210, June.
    • Handle: RePEc:anr:reseco:v:5:y:2013:p:197-210
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    More about this item

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • O44 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Environment and Growth
    • Q50 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - General
    • Q55 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Technological Innovation

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