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Grön produktion och fortsatt ekonomisk tillväxt? En simuleringsstudie av EU:s framtida ekonomiska tillväxt och växthusgasutsläpp

Östling Svensson, Karin LU and Wiktorsson, Elvira (2020) NEKH03 20201
Department of Economics
Abstract
The intertemporal relationship between economic growth and climate change represents a major challenge for the economies of today. The growth in production based on carbon intensive inputs has contributed to a continuous increase in greenhouse gas emissions since the Industrial Revolution. The aim of this essay is to analyse the relationship between climate change and economic growth within the European Union (EU) and how it will continue to evolve over the course of the coming century. The essay examines how growth and greenhouse gas emissions are affected by maintaining the current carbon-intensive production system and analyses whether the EU can reach its goal of becoming a climate-neutral economy by 2050, using existing resources to... (More)
The intertemporal relationship between economic growth and climate change represents a major challenge for the economies of today. The growth in production based on carbon intensive inputs has contributed to a continuous increase in greenhouse gas emissions since the Industrial Revolution. The aim of this essay is to analyse the relationship between climate change and economic growth within the European Union (EU) and how it will continue to evolve over the course of the coming century. The essay examines how growth and greenhouse gas emissions are affected by maintaining the current carbon-intensive production system and analyses whether the EU can reach its goal of becoming a climate-neutral economy by 2050, using existing resources to invest in green capital and green technological development. By developing an endogenous growth model based on the Romer model, where greenhouse gas emissions are endogenised and growth is driven by both carbon intensive and green technological change, the essay assesses how environmental policy will affect GDP per capita growth and the accumulation of greenhouse gases. The main conclusions are that continued production through a carbon-intensive system will have a negative impact on both the climate and economic performance. However, investing in green capital and green technology will induce a stabilisation of atmospheric greenhouse gas levels and help ensure sustained long- term economic growth. Achieving the objective of climate neutrality by 2050 will however require the EU to increase investment in capital and technological development. (Less)
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author
Östling Svensson, Karin LU and Wiktorsson, Elvira
supervisor
organization
alternative title
Green production and continued economic growth? A simulation study of the future economic growth and greenhouse gas emissions in the EU
course
NEKH03 20201
year
type
M2 - Bachelor Degree
subject
keywords
climate change, economic growth, European Union, endogenous growth model, greenhouse gas emissions, green technology, green capital
language
Swedish
id
9013321
date added to LUP
2020-08-29 11:30:14
date last changed
2020-08-29 11:30:14
@misc{9013321,
  abstract     = {The intertemporal relationship between economic growth and climate change represents a major challenge for the economies of today. The growth in production based on carbon intensive inputs has contributed to a continuous increase in greenhouse gas emissions since the Industrial Revolution. The aim of this essay is to analyse the relationship between climate change and economic growth within the European Union (EU) and how it will continue to evolve over the course of the coming century. The essay examines how growth and greenhouse gas emissions are affected by maintaining the current carbon-intensive production system and analyses whether the EU can reach its goal of becoming a climate-neutral economy by 2050, using existing resources to invest in green capital and green technological development. By developing an endogenous growth model based on the Romer model, where greenhouse gas emissions are endogenised and growth is driven by both carbon intensive and green technological change, the essay assesses how environmental policy will affect GDP per capita growth and the accumulation of greenhouse gases. The main conclusions are that continued production through a carbon-intensive system will have a negative impact on both the climate and economic performance. However, investing in green capital and green technology will induce a stabilisation of atmospheric greenhouse gas levels and help ensure sustained long- term economic growth. Achieving the objective of climate neutrality by 2050 will however require the EU to increase investment in capital and technological development.},
  author       = {Östling Svensson, Karin and Wiktorsson, Elvira},
  keyword      = {climate change,economic growth,European Union,endogenous growth model,greenhouse gas emissions,green technology,green capital},
  language     = {swe},
  note         = {Student Paper},
  title        = {Grön produktion och fortsatt ekonomisk tillväxt? En simuleringsstudie av EU:s framtida ekonomiska tillväxt och växthusgasutsläpp},
  year         = {2020},
}