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Sustainability 2017, 9(9), 1534;

A General Equilibrium View of Population Ageing Impact on Energy Use via Labor Supply

CICERO Center for International Climate Research, P.O. Box 1129 Blindern, 0318 Oslo, Norway
School of Social Development and Public Policy, Fudan University, Shanghai 200433, China
Author to whom correspondence should be addressed.
Received: 1 August 2017 / Revised: 21 August 2017 / Accepted: 24 August 2017 / Published: 30 August 2017
(This article belongs to the Section Energy Sustainability)
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Globally, population ageing is accelerating, i.e., the share of older persons in the population is increasing. The population ageing can have considerable impacts on economic growth, energy use and related carbon emissions, affecting sustainable development. A few studies have analyzed the issue by econometric methods, decomposition and CGE modeling. To facilitate understanding of the simulated results from empirical studies, we developed an analytical general equilibrium model to study the population ageing impact on energy-related emissions, focusing on the long-term potential of economic development by considering the interactions between key productive resources, including labor, capital, and energy. Based on a special case of Cobb–Douglas production function, we show that population ageing can result in considerably less emissions at a lower rate than the ageing in the long term. For example, the reduced global emissions in 2050 can be equivalent to one-recent-year emissions in Japan in the Representative Concentration Pathway (RCP) 8.5 scenario. We also find that the price elasticity of energy supply is the most important parameter to determine the potential impact of population ageing on energy use and related emissions. In the future, the price elasticity of energy supply may become more inelastic than today due to strict climate policy and increasing extraction cost of fossil fuels. Hence, the ageing impact on emissions may be diminishing over time. View Full-Text
Keywords: population ageing; energy use; emissions; general equilibrium; labor supply population ageing; energy use; emissions; general equilibrium; labor supply

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Wei, T.; Zhu, Q.; Glomsrød, S. A General Equilibrium View of Population Ageing Impact on Energy Use via Labor Supply. Sustainability 2017, 9, 1534.

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