Economic Growth and the Transition from Traditional to Modern Energy in Sweden

37 Pages Posted: 25 Sep 2013

See all articles by Astrid Kander

Astrid Kander

Lund University

David I. Stern

Australian National University (ANU) - Crawford School of Public Policy

Date Written: September 1, 2013

Abstract

We examine the role of substitution from traditional to modern energy carriers and of differential rates of innovation in the use of each of these in Sweden from 1850 to 1950. We use a simple growth model with a nested CES production function and exogenous factor augmenting technological change and carry out a growth accounting decomposition based on the econometric results. Energy and energy augmenting technological change contributed more than a third of the economic growth in this period. Even though the rate of technical change was much larger for modern energy, innovation in the use of traditional energy carriers contributed more to growth between 1850 and 1890, since the cost share of traditional energy was so much larger than that of modern energy in that period. However, after 1890 we find that modern energy contributed much more to economic growth than traditional energy, but increasingly labor augmenting technological change and capital accumulation became the most important drivers of growth in the final decades of the period.

JEL Classification: O13, O41, Q43, N13, N14

Suggested Citation

Kander, Astrid and Stern, David I., Economic Growth and the Transition from Traditional to Modern Energy in Sweden (September 1, 2013). CAMA Working Paper Series Paper 65/2013, Available at SSRN: https://ssrn.com/abstract=2330036 or http://dx.doi.org/10.2139/ssrn.2330036

Astrid Kander

Lund University ( email )

Box 117
Lund, SC Skane S221 00
Sweden

David I. Stern (Contact Author)

Australian National University (ANU) - Crawford School of Public Policy ( email )

ANU College of Asia and the Pacific
J.G. Crawford Building, #132, Lennox Crossing
Canberra, Australian Capital Territory 0200
Australia

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
48
Abstract Views
611
PlumX Metrics