Paying Too Much for Energy? The True Costs of Our Energy Choices
Author(s)
Greenstone, Michael; Looney, Adam
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This paper estimates the effect of access to transportation networks on regional economic outcomes in China over a twenty-period of rapid income growth. It addresses the problem of the endogenous placement of networks by exploiting the fact that these networks tend to connect historical cities. Our results show that proximity to transportation networks have a moderate positive causal effect on per capita GDP levels across sectors, but no effect on per capita GDP growth. We provide a simple theoretical framework with empirically testable predictions to interpret our results. We argue that our results are consistent with factor mobility playing an important role in determining the economic benefits of infrastructure development.
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Note: Despite reference to earlier paper and paper's revision date, this is the first time this paper has been an MIT, Dept of Economics working paper.
Date issued
2012-02-24Publisher
Cambridge, MA: Department of Economics, Massachusetts Institute of Technology
Series/Report no.
Working paper, Department of Economics, Massachusetts Institute of Technology;12-06
Keywords
costs of alternative energy, energy externalities, health costs of energy, private costs of energy, reforming energy policy, social costs of energy
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