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The non-rivalry of data, directed technical change and the environment: A theoretical study incorporating data as a production factor

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  • Yang, Jun
  • Yang, Dingjian
  • Cheng, Jixin

Abstract

With the evolution of digital technology, data is considered a new input factor. To investigate the impact of the degree of application and non-rivalry of data on technical change and the environment, we introduce data as a production factor into the production function and develop a two-sector directed technical change model. More importantly, we introduce non-rivalry in data use, enabling its use across sectors. The relevant results are threefold. (1) Data alone cannot avoid environmental disaster; what is worse, the application of data will accelerate environmental degradation. (2) Only in combination with environmental regulations can data play a positive role. In such case, the application of data will accelerate the rise of environmental quality. (3) Conversely, the non-rivalry has a positive effect without environmental regulations while a negative effect with environmental regulations.

Suggested Citation

  • Yang, Jun & Yang, Dingjian & Cheng, Jixin, 2024. "The non-rivalry of data, directed technical change and the environment: A theoretical study incorporating data as a production factor," Economic Analysis and Policy, Elsevier, vol. 82(C), pages 417-448.
    • Handle: RePEc:eee:ecanpo:v:82:y:2024:i:c:p:417-448
    DOI: 10.1016/j.eap.2024.03.020
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