The UT Energy Symposium welcomes Dr. Carey King, Assistant Director of the Energy Institute, to give a talk titled Economic models need biophysical principles: Otherwise we can’t explain our energy past or future.
Dr. Carey W King performs interdisciplinary research related to how energy systems interact within the economy and environment as well as how our policy and social systems can make decisions and tradeoffs among these often competing factors. The past performance of our energy systems is no guarantee of future returns, yet we must understand the development of past energy systems. Carey’s research goals center on rigorous interpretations of the past to determine the most probable future energy pathways.
Carey is Research Scientist at The University of Texas at Austin and Assistant Director at the Energy Institute. He also has appointments with the Center for International Energy and Environmental Policy within the Jackson School of Geosciences and the McCombs School of Business. He has both a B.S. with high honors and Ph.D. in Mechanical Engineering from the University of Texas at Austin. He has published technical articles in the academic journals Environmental Science and Technology, Environmental Research Letters, Nature Geoscience, Energy Policy, Sustainability, and Ecology and Society. He has also written commentary for American Scientist and Earth magazines as well as major newspapers such as the Dallas Morning News, Houston Chronicle, and Austin American-Statesman.
Abstract: Energy drives and defines our economy. Economics informs policy. Policy affects social outcomes. Because of this sequence, economic theory plays a crucial role for interpreting historical trends and projecting future possibilities. However, most long-term macroeconomic models use theory that fails to integrate energy principles and feedbacks at a fundamental level. While this might sound like a discussion only for academics, this is not the case. The implications are very real. The public and policymakers are misled. Fossil fuel, nuclear, or renewable energy advocates can claim to base their conclusions on sound economic theory because they are unaware of fundamental theoretical flaws of most macroeconomic models. Consider analysis of a low-carbon or renewable energy transition. We think macroeconomic models take inputs as a series of energy investments and give outputs such economic growth, debt, and wages. However, this is not the case. Instead of assuming energy scenarios and calculating GDP, debt, wages, and other important variables, macromodeling (usually) assumes GDP and postulates energy scenarios and spending under that assumption. This is the exact opposite of what we need. Energy-related constraints force trade-offs for social outcomes, and we must understand these constraints. We must accept them and integrate them into our economic thinking. We cannot pretend they don’t exist because if we do, we will misdiagnose why policies don’t achieve desired outcomes. In this talk, Dr. Carey W. King will discuss data and concepts that provide a much better understanding of energy-economic interactions than neoclassical growth theory, and that we need to understand the social and economic impacts of our changing energy system.
The UT Energy Symposium meets every Thursday during the long semesters. Come early to attend a networking session before the talk.