| Introduction | p. 1 |
| Motivation and Research Question | p. 1 |
| Analytical Approach | p. 2 |
| Main Contribution | p. 3 |
| Outline | p. 5 |
| Theoretical Analysis | |
| Foundations of the Theoretical Analysis | p. 9 |
| Social versus Private Time Preferences | p. 9 |
| The Economic Discounting Debate: First-best Benchmark, Second-best Cases, and Some More Recent Issues | p. 10 |
| Three Reasons Particularly Relevant for the Present Analysis | p. 16 |
| Summary and Treatment of the Assumption in the Model | p. 27 |
| Time-Lagged Capital Theory | p. 29 |
| Its Evolution and the Basic Neo-Austrian Three-process Model | p. 30 |
| New Extensions | p. 32 |
| Analytical Structure of the Model in Chapter 3 | p. 32 |
| Conclusion | p. 33 |
| A Theoretical Model of Structural Change in the Energy Industry | p. 35 |
| Model | p. 35 |
| Social Optimum | p. 38 |
| Necessary and Sufficient Conditions for Social Optimum | p. 38 |
| Conditions for Investment and Replacement | p. 41 |
| Unregulated Competitive Market Equilibrium | p. 45 |
| The Household's Market Decisions | p. 45 |
| The Firms' Market Decisions | p. 46 |
| Necessary and Sufficient Condition for Unregulated Market Equilibrium | p. 47 |
| Conditions for Investment and Replacement | p. 48 |
| Competitive Market Equilibrium with Emission Tax and Investment Subsidy | p. 51 |
| The Household's and Firms' Market Decisions under Regulation | p. 51 |
| Necessary and Sufficient Condition for Regulated Market Equilibrium | p. 52 |
| Conditions for Investment and Replacement | p. 54 |
| Conclusion | p. 58 |
| Summary of Results, Discussion of Assumptions, and Policy Implications | p. 59 |
| Summary of Results | p. 59 |
| Too Low Unit Costs of Energy of Established Technology as Compared to Social Optimum Due to Pollution | p. 59 |
| Too High Unit Costs of Energy of New Technology as Compared to Social Optimum Because Private Time-Preference Rate Higher Than Socially Optimal | p. 60 |
| Time Lag of Capital Accumulation Reinforces Distortion from Split of Social and Private Time-Preference Rates | p. 61 |
| Distortions Imply in Mutually Reinforcing Way Less Favorable Circumstances for Innovation and Replacement | p. 61 |
| Social Optimum May Be Implemented by Setting Appropriate Emission Tax and Investment Subsidy | p. 62 |
| Environmental Policy Alone Biased Towards Gradual Change, Technology Policy Alone Independant of Environmental Effect | p. 62 |
| Discussion of Model Assumptions | p. 63 |
| Social Rate of Time Preference Below Private | p. 63 |
| Time Lag in Capital Accumulation | p. 63 |
| Focus on Linear-limitational, General Energy Technologies | p. 64 |
| Labor Only Primary Input, Energy Homogeneous Output | p. 64 |
| Emissions as Flow Pollutant | p. 65 |
| Abstraction from Peculiarities of Economics of Power Systems | p. 65 |
| Policy Implications | p. 65 |
| New Reason for Technology Policy | p. 66 |
| No Support of Subsidies for Specific Technologies | p. 66 |
| Necessary Completion of Environmental by Technology Policy | p. 66 |
| Environmental Policy Alone Favors Gradual Change | p. 67 |
| Substantiation of Win-win Hypothesis of Environmental Regulation | p. 67 |
| Conclusions to Theoretical Part | p. 67 |
| Applied Analysis | |
| Foundations of the Applied Analysis | p. 71 |
| Analytical Setting and Specifics of the Applied Investigation | p. 71 |
| Analytical Setting | p. 72 |
| Focus on Germany Around 2015 and Conventional Generation Technologies | p. 73 |
| Previous Literature, Contribution, and Data Sources | p. 74 |
| Relationship to Theoretical Part | p. 77 |
| Financial Model | p. 78 |
| Capital Costs | p. 78 |
| Costs During Operation | p. 80 |
| Unit Costs of Electricity of the New Technologies | p. 81 |
| Unit Costs of Electricity of the Established Technology | p. 82 |
| Technical and Economic Parameters | p. 83 |
| Old and New Coal-fired Reference Power Plants | p. 83 |
| Gas-fired Reference Power Plant | p. 88 |
| Nuclear Reference Power Plant | p. 91 |
| Policy Parameters | p. 96 |
| Environmental Policy | p. 96 |
| Technology Policy | p. 97 |
| Conclusion | p. 99 |
| Technology Choice Under Environmental and Technology Policies | p. 101 |
| No-policy Benchmark | p. 101 |
| Technology Choice Without Abatement Technology | p. 102 |
| Sensitivity Under Environmental Policy | p. 102 |
| Sensitivity Under Technology Policy | p. 104 |
| Sensitivity Under Environmental and Technology Policies Combined | p. 107 |
| Technology Choice With Abatement Technology | p. 109 |
| Sensitivity Under Environmental Policy | p. 109 |
| Sensitivity Under Environmental and Technology Policies Combined | p. 110 |
| Summary and Discussion of Results | p. 112 |
| No-policy Benchmark | p. 112 |
| Results Under Environmental Policy Without and With Abatement Option | p. 113 |
| Results in Cases with Technology Policy | p. 114 |
| Results According to Nl and Nh Scenarios | p. 115 |
| Conclusion | p. 116 |
| Optimal Moments of Transition Under Environmental and Technology Policies | p. 119 |
| Determination of the Optimal Moment of Transition | p. 119 |
| No-policy Benchmark | p. 121 |
| Optimal Moments of Transition Without Abatement Technology | p. 122 |
| Sensitivity Under Environmental Policy | p. 122 |
| Sensitivity Under Technology Policy | p. 124 |
| Sensitivity Under Environmental and Technology Policies Combined | p. 126 |
| Optimal Moments of Transition With Abatement Technology | p. 129 |
| Sensitivity Under Environmental Policy | p. 129 |
| Sensitivity Under Environmental and Technology Policies Combined | p. 131 |
| Summary and Discussion of Results | p. 133 |
| No-policy Benchmark | p. 133 |
| Results Under Environmental Policy Without and With Abatement Option | p. 133 |
| Results in Cases with Technology Policy | p. 135 |
| Results According to Nl and Nh Scenarios | p. 137 |
| Conclusion | p. 138 |
| Conclusions | p. 141 |
| Putting the Analysis in Perspective | p. 141 |
| Policy Conclusions | p. 143 |
| Issues for Further Research | p. 144 |
| Appendix to Part I | p. 147 |
| Concavity of Hamiltonian Along Optimal Path | p. 147 |
| Optimal Transition Dynamics and Stationary States | p. 148 |
| Saddle-Point Stability of Interior Solution | p. 149 |
| Appendix to Part II | p. 155 |
| Summary of Technical, Financing, and Cost Parameters | p. 155 |
| References | p. 157 |
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