Research papers
1992 · Econometrica · 7,465 citations
This paper develops a model based on Schumpeter's process of creative destruction. It departs from existing models of endogenous growth in emphasizing obsolescence of old technologies induced by the accumulation of knowledge and the resulting process or industrial innovations. This has both positive and normative implications for growth. In positive terms, the prospect of a high level of research in the future can deter research today by threatening the fruits of that research with rapid obsolescence. In normative terms, obsolescence creates a negative externality from innovations, and hence a tendency for laissez-faire economies to generate too many innovations, i.e too much growth. This business-stealing effect is partly compensated by the fact that innovations tend to be too small under laissez-faire. The model possesses a unique balanced growth equilibrium in which the log of GNP follows a random walk with drift. The size of the drift is the average growth rate of the economy and it is endogenous to the model ; in particular it depends on the size and likelihood of innovations resulting from research and also on the degree of market power available to an innovator.
2004 · Frontiers in Ecology and the Environment · 49 citations
Sustainability is often poorly defined and difficult to measure. We describe several concepts from ecology, economics, and physics, that have contributed to sustainability indices, and discuss their positive and negative aspects. Indices range from mostly ecological (such as ecosystem resilience and global human carrying capacity), to those inspired by both economics and ecology (green income and maximum sustainable yield), to a mix of ecology and physics (exergy and emergy). Economic concepts such as substitutability of natural and human capital (the “weak” versus “strong” sustainability debate), and throughput of natural resources through an economic system, are the basis for several strictly economic indices. The second law of thermodynamics, which dictates the decrease in usable energy, has also had an increasing influence on sustainability discussions. The indices described here address different aspects of the interactions between human societies and ecosystems, and are therefore probably most effective when used in combination.
2004 · Frontiers in Ecology and the Environment · 7 citations
Sustainability is often poorly defined and difficult to measure. We describe several concepts from ecology, economics, and physics, that have contributed to sustainability indices, and discuss their positive and negative aspects. Indices range from mostly ecological (such as ecosystem resilience and global human carrying capacity), to those inspired by both economics and ecology (green income and maximum sustainable yield), to a mix of ecology and physics (exergy and emergy). Economic concepts such as substitutability of natural and human capital (the “weak” versus “strong” sustainability debate), and throughput of natural resources through an economic system, are the basis for several strictly economic indices. The second law of thermodynamics, which dictates the decrease in usable energy, has also had an increasing influence on sustainability discussions. The indices described here address different aspects of the interactions between human societies and ecosystems, and are therefore probably most effective when used in combination.