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Technical Change Theory and Learning Curves: Patterns of Progress in Electricity Generation Technologies

Abstract:
Better understanding of the role of learning in technical progress is important for the development of innovation theory and technology policy. This paper presents a comparative analysis of the effect of learning and technical change in electricity generation technologies. We use simultaneous two-factor learning and diffusion models to estimate the effect of learning by doing and learning by research on technical progress for a range of technologies in four stages of development. We find learning patters broadly in line with the perceived view of technical progress. The results generally show higher learning by research than learning by doing rates. Moreover, we do not find any development stage where learning by doing is stronger than learning by research. We show that simple learning by doing curves overstate the effect of learning in particular for newer technologies. Finally, we find little substitution potential between learning by doing and research for most technologies.

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Energy Specializations: Electricity – Generation Technologies; Electricity – Markets and Prices ; Electricity – Policy and Regulation

JEL Codes: Q42: Alternative Energy Sources, Q41: Energy: Demand and Supply; Prices, O33: Technological Change: Choices and Consequences; Diffusion Processes, Q55: Environmental Economics: Technological Innovation, Q54: Climate; Natural Disasters and Their Management; Global Warming, C51: Model Construction and Estimation, Q35: Hydrocarbon Resources

Keywords: Energy technology, technical change, learning curves, electricity generation, R&D

DOI: 10.5547/ISSN0195-6574-EJ-Vol28-No3-4

Published in Volume 28, Number 3 of the bi-monthly journal of the IAEE's Energy Economics Education Foundation.

 

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