Event
What do Net-Zero Scenarios Imply for Aggregate Productivity?
- 28 June 2024
- Expired!
- 3:00 pm - 4:00 pm
Location
- Attendance: in person
- Language: EN
Event
What do Net-Zero Scenarios Imply for Aggregate Productivity?
Reaching net zero emissions requires deep transformations of the production system, necessarily affecting productivity. However, very little is known about the aggregate productivity effects of technological and structural changes implied by net-zero scenarios. We build a parsimonious and transparent macroeconomic framework to assess these impacts. Our approach uses price and output growth pathways available in net zero scenario and produces distributional forecasts for industry-level and aggregate productivity growth. We apply this method to the UK net zero transition scenarios. Preliminary results indicate a limited net impact of the net zero transition on UK productivity growth, in part due to positive and negative effects partially canceling out. Our results also highlight that renewable-intensive energy portfolios have a much higher positive impact on aggregate productivity, compared to scenarios that rely relatively more on carbon capture and storage. (Joint work with Emilien Ravigné)