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Heterogeneous capital stocks and economic inertia in the US economy

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Heterogeneous capital stocks and economic inertia in the US economy. / Chester, D.; Lynch, C.; Szerszynski, B. et al.
In: Ecological Economics, Vol. 217, 108075, 31.03.2024.

Research output: Contribution to Journal/Magazine › Journal article › peer-review

Harvard

Chester, D, Lynch, C, Szerszynski, B, Mercure, J-F & Jarvis, A 2024, 'Heterogeneous capital stocks and economic inertia in the US economy', Ecological Economics, vol. 217, 108075. https://doi.org/10.1016/j.ecolecon.2023.108075

APA

Chester, D., Lynch, C., Szerszynski, B., Mercure, J-F., & Jarvis, A. (2024). Heterogeneous capital stocks and economic inertia in the US economy. Ecological Economics, 217, Article 108075. https://doi.org/10.1016/j.ecolecon.2023.108075

Vancouver

Chester D, Lynch C, Szerszynski B, Mercure J-F, Jarvis A. Heterogeneous capital stocks and economic inertia in the US economy. Ecological Economics. 2024 Mar 31;217:108075. Epub 2023 Dec 20. doi: 10.1016/j.ecolecon.2023.108075

Author

Chester, D. ; Lynch, C. ; Szerszynski, B. et al. / Heterogeneous capital stocks and economic inertia in the US economy. In: Ecological Economics. 2024 ; Vol. 217.

Bibtex

@article{34af6d6beec543f699b6d4fb691b19f0,
title = "Heterogeneous capital stocks and economic inertia in the US economy",
abstract = "The timescales of capital investments, and therefore the turnover dynamics of capital stock, have limited representation in macroeconomic modelling. This hinders analysis of the economic inertia produced by these timescales, which is particularly important in the context of a rapid net zero transition in which vast quantities of long-lived investments may need to be prematurely abandoned. We set out to determine the minimum model that is required to accurately represent the turnover dynamics of fixed capital. We develop a quantitative framework for estimating the turnover time of fixed capital assets in the US economy, and derive the annual distribution of both total fixed capital stock and new investments across timescales. We find that these can be effectively aggregated into three major timescale components which can be easily incorporated into integrated assessment models.",
keywords = "Capital stocks, Economic inertia, Integrated assessment modelling, Stranded assets, Carbon lock-in, Turnover time",
author = "D. Chester and C. Lynch and B. Szerszynski and J.-F. Mercure and A. Jarvis",
year = "2024",
month = mar,
day = "31",
doi = "10.1016/j.ecolecon.2023.108075",
language = "English",
volume = "217",
journal = "Ecological Economics",
issn = "0921-8009",
publisher = "Elsevier Science B.V.",

}

RIS

TY - JOUR

T1 - Heterogeneous capital stocks and economic inertia in the US economy

AU - Chester, D.

AU - Lynch, C.

AU - Szerszynski, B.

AU - Mercure, J.-F.

AU - Jarvis, A.

PY - 2024/3/31

Y1 - 2024/3/31

N2 - The timescales of capital investments, and therefore the turnover dynamics of capital stock, have limited representation in macroeconomic modelling. This hinders analysis of the economic inertia produced by these timescales, which is particularly important in the context of a rapid net zero transition in which vast quantities of long-lived investments may need to be prematurely abandoned. We set out to determine the minimum model that is required to accurately represent the turnover dynamics of fixed capital. We develop a quantitative framework for estimating the turnover time of fixed capital assets in the US economy, and derive the annual distribution of both total fixed capital stock and new investments across timescales. We find that these can be effectively aggregated into three major timescale components which can be easily incorporated into integrated assessment models.

AB - The timescales of capital investments, and therefore the turnover dynamics of capital stock, have limited representation in macroeconomic modelling. This hinders analysis of the economic inertia produced by these timescales, which is particularly important in the context of a rapid net zero transition in which vast quantities of long-lived investments may need to be prematurely abandoned. We set out to determine the minimum model that is required to accurately represent the turnover dynamics of fixed capital. We develop a quantitative framework for estimating the turnover time of fixed capital assets in the US economy, and derive the annual distribution of both total fixed capital stock and new investments across timescales. We find that these can be effectively aggregated into three major timescale components which can be easily incorporated into integrated assessment models.

KW - Capital stocks

KW - Economic inertia

KW - Integrated assessment modelling

KW - Stranded assets

KW - Carbon lock-in

KW - Turnover time

U2 - 10.1016/j.ecolecon.2023.108075

DO - 10.1016/j.ecolecon.2023.108075

M3 - Journal article

VL - 217

JO - Ecological Economics

JF - Ecological Economics

SN - 0921-8009

M1 - 108075

ER -