GRETCHEN investigates the impact of climate, renewable energy and innovation policies (the "policy mix") on technological and structural change in renewable power generation technologies. GRETCHEN uses an innovative research design based on three pillars: the combination of environmental and innovation economics, a multi-method approach and an integrated analysis on three empirical levels. These three are: a micro-level, which examines the influence of the policy mix on company-internal invention, innovation and diffusion; a meso level, which addresses the impacts on innovation networks and market structures; and a macro level, which derives macroeconomic statements by endogenizing technological change. The project results and the derived policy recommendations for designing the policy mix are addressed to decision-makers from academia, politics and industry.
GWSs contribution to GRETCHEN is the analysis of the impacts of the policy mix on technological change, welfare (economic development and employment), trade and structural change using the global macroeconomic, input-output model GINFORS. This requires the following steps:
- 1. Identify the effects of the policy mix on innovation and hence on technological change.
- 2. Quantify the effects of technological change on the model parameters and variables.
- 3. Analyze the resulting effects on the economy.
The first step will be based on the results of the analyses in work packages 1, 2 and 3, where the policy mix is defined and the effects on the micro and meso levels are analyzed. For the second step, GINFORS will be extended to include endogenous technological change. The renewable power generation sector has to be modeled in more detail, the industrial sectors that are part of the supply chain of renewable power generation technologies have to be identified and the effects of the changing technology have to be endogenized. The subsequent policy scenario analysis of step three will indicate the possible effects of the policy mix on welfare, trade and structural change.