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Evolution and Economic Complexity

Edited by J. Stanley Metcalfe and John Foster

Dedicated to the goal of furthering evolutionary economic analysis, this book provides a coherent scientific approach to deal with the real world of continual change in the economic system. Expansive in its scope, this book ranges from abstract discussions of ontology, analysis and theory to more practical discussions on how we can operationalize notions such as ‘capabilities’ from what we understand as ‘knowledge’. Simulation techniques and empirical case studies are also used.
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Chapter 9: A Conceptual Framework to Model Long-run Qualitative Change in the Energy System

Andreas Pyka, Bernd Ebersberger and Horst Hanusch


Andreas Pyka, Bernd Ebersberger and Horst Hanusch1 INTRODUCTION The energy-related industries are sectors where, compared to many other industries, extremely long time horizons are relevant for the strategic planning of the actors. On the one hand, the investment costs are extremely high and most often irreversible, that is, the power plants cannot be used for other purposes; on the other, the investment time for constructing new power plants and complementary activities such as the construction of distribution networks is also extremely protracted. Additionally, the influence of regulatory authorities as well as political actors is strong due to the specific industry history (that is, energy is considered to be of decisive national importance) and the strong interrelation with other economic and social activities (for example, environmental issues, transport and so on). Finally, technological development is often extremely costly as well as uncertain, which makes joint efforts between public and private actors necessary. Bearing in mind these specific industry characteristics, the energy sector seems to be of particular interest when it comes to the analysis of the longrun and technological-driven evolution of industries. Although there is a rather long tradition in economics for studying the transformation of industries, starting at the beginning of the twentieth century with Joseph Schumpeter, Simon Kuznets and J.B. Clark, since the late 1950s this long-term view has been lost in the industrial economics literature. There are basically two reasons for this. On the one hand, industrial economics was mainly embedded in the dominating...

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