Entropy, Substitution and Sustainable Economic Growth

Yanying Chen, Chunying Li

Abstract


In the debate over sustainable economic growth, two critical issues are elasticity of substitution and technical change. Due to entropy increasing law in MEI system, the elasticity of substitution between any two resources must decline to zero and the efficiency improvement of resources from technical change is also limited. Therefore, substitution and technical change can not sustain economic growth forever.

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DOI: http://dx.doi.org/10.5430/rwe.v2n2p66

Research in World Economy
ISSN 1923-3981(Print)ISSN 1923-399X(Online)

 

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