Machines and Energy. Energy Capital ratios in Europe and Latin America 1875 - 1970

Research output: Contribution to journalArticle

Abstract

The relationship between energy and capital is one of the most important aspects of modern economic growth. Machines need energy to produce all the goods we enjoy; energy would be far less useful for humankind in absence of machines. However, the great majority of the economic models do not take into account the elasticities of substitution (or complementaries) between these two main variables. Actually, energy is absent in many growth models and discussions on diverging economic development paths. We approach this relevant issue from a new perspective: energy and capital relations during 100 years. We use the latest estimations of capital stock (machinery and equipment) and energy consumption for Latin America and compare them with those of Western Europe. The energy–capital ratio (how much energy is used per unit of capital) could be a predictor of economic growth, thus providing stylised facts about the timing and causes of the different modernisation patterns of these regions and showing us some answers on the long-run relationship between energy consumption and capital accumulation.

Details

Authors
Organisations
External organisations
  • Public University of Navarre
  • University of Groningen
  • Technical University of Dortmund
Research areas and keywords

Subject classification (UKÄ) – MANDATORY

  • Economic History

Keywords

  • energy efficiency, Machines, Capital stock, Latin America, Europe
Original languageEnglish
Pages (from-to)31-46
JournalScandinavian Economic History Review
Volume67
Issue number1
Early online date2018 Sep 3
Publication statusPublished - 2019
Publication categoryResearch
Peer-reviewedYes

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