We develop a general equilibrium dynamic stochastic business cycle model augmented with uncertain total factor productivity shocks and investment specific technology shocks. Agents only observe noisy signals of these shocks, such as realized GDP, and update their beliefs each period about the fundamentals of the economy. We interpret this inability to perfectly observe the fundamentals of the e...

We study changes in fossil fuel and non-fossil energy use and carbon dioxide emissions induced by carbon taxes. We develop a partial energy equilibrium model with capital and labor as production factors, and endogenous technological change through learning by doing and learning through research, distinguishing between private and public innovations. Our model reproduces the learning curves typi...

In this paper we introduce investment specific technical progress into Pasinetti’s model of structural change. Our aim is to assess the effects of embodied technical progress on economic growth and macroeconomic variables. Our findings suggest that despite the fact that this type of technical progress increases the productivity of capital, it has negative effects on conditions that promote full...