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Hybrid Modeling: New Answers to Old Challenges Introduction to the Special Issue of The Energy Journal

Jean-Charles Hourcade, Mark Jaccard, Chris Bataille, and Frederic Ghersi 

Year: 2006
Volume: Hybrid Modeling
Number: Special Issue #2
DOI: 10.5547/ISSN0195-6574-EJ-VolSI2006-NoSI2-1
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Abstract:
After nearly two decades of debate and fundamental disagreement, top-down and bottom-up energy-economy modelers, sometimes referred to as modeling �tribes�, began to engage in productive dialogue in the mid-1990s (IPCC 2001). From this methodological conversation have emerged modeling approaches that offer a hybrid of the two perspectives. Yet, while individual publications over the past decade have described efforts at hybrid modeling, there has not as yet been a systematic assessment of their prospects and challenges. To this end, several research teams that explore hybrid modeling held a workshop in Paris on April 20�21, 2005 to share and compare the strategies and techniques that each has applied to the development of hybrid modeling. This special issue provides the results of the workshop and of follow-up efforts between different researchers to exchange ideas.



Macroeconomic Consistency issues in E3 Modeling: The Continued Fable of the Elephant and the Rabbit

Frederic Ghersi and Jean-Charles Hourcade

Year: 2006
Volume: Hybrid Modeling
Number: Special Issue #2
DOI: 10.5547/ISSN0195-6574-EJ-VolSI2006-NoSI2-3
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Abstract:
Starting from a short presentation of the limits of using conventional production functions to hybridize energy-economy relationships, this paper presents a methodology aiming at a better integration of bottom-up policy scenarios in a top-down static general equilibrium framework. Along the lines of Ahmad�s innovation possibility curve, the methodology consists in implementing top-down envelopes of production and demand functions, whose variable point elasticities of substitution provide a flexible interface for calibration on any bottom-up expertise. Numerical experiments assessing the impact of a rising carbon tax on the global 2030 economy compare the application of this methodology to that of two standard CES-based approaches. Results confirm that, in case of large departures from reference scenarios or of strong convexities in bottom-up results, the use of conventional CES production and utility functions may lead to a significant bias in cost assessment.





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