Jan Witajewski-Baltvilks and Marek Antosiewicz from our Institute developed and presented a theoretical model highlighting the differences between the short and long run price elasticity of energy demand. The model, which uses the technological choice paradigm, was used to simulate the effect that an energy price increase following the introduction of a carbon tax can have on the coal dependent Polish economy. Using simulations from a DSGE model equipped with the technological choice mechanism, we show that higher firm technological elasticity leads to a shallower drop in employment and GDP and to a higher drop in energy demand. The latter effect unfortunately also implies additional negative pressure on employment in the Polish coal mining sector.
The results has been presented at the “37th International Energy Workshop 2018” (IEW 2018 – Gothenburg, Sweden, 19-21.06.) by Jan Witajewski-Baltvilks, and at the 24th International Conference “Computing in Economics and Finance 2018” (CEF 2018 – Milan, Italy, 19-21.06.) by Marek Antosiewicz. We encourage you to read the presentation.
International Energy Workshop (IEW) is one of the oldest and most prestigious meetings on the topics related to energy in the world. Every year since 1981, this relatively small workshop gathers the group of the most influential energy economists to discuss the frontier research results in that field.
Computing in Economics and Finance (CEF) is an international conference organised annually by the Society for Computational Economics (SCE). There are presented research using computational methods among others in statistics, econometrics, finance and macroeconomic modeling.