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Ratio Working Paper No. 336 An Austrian economic perspective on failed Chinese wind power development

PublicationWorking paper
Austrian school, China, Economic Planning, Energy, Jonas Grafström, Technology, Wind power
Working Paper No. 336
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Abstract

China is currently hailed as the world’s premier wind power producer. However, despite twice the installed wind power capacity compared to the United States in 2015, the Chinese installed capacity produces less power. Grid connectivity is remarkably low, Chinese firms have few international granted patents, and export is minimal even though production capacity far exceeds the domestic production needs. Using the tools of Austrian economics, failures in China’s wind power development from 1980-2016 is documented and analysed. From a theoretical standpoint, both a planning problem and an entrepreneurial problem is evident where governmental policies create misallocation of resources and a hampering of technological development.

Grafström, J. (2020). An Austrian economic perspective on failed Chinese wind power development. Ratio Working Paper No. 336. Stockholm: Ratio.


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China is currently the world’s largest installer of wind power. However, with twice the installed wind capacity compared to the United States in 2015, the Chinese produce less power. The question is: Why is this the case? This article shows that Chinese grid connectivity is low, Chinese firms have few international patents, and that export is low even though production capacity far exceeds domestic production needs. Using the tools of Austrian economics, China’s wind power development from 1980 to 2016 is documented and analyzed from three angles: (a) planning and knowledge problems, (b) unproductive entrepreneurship, and (c) bureaucracy and government policy. From a theoretical standpoint, both a planning problem and an entrepreneurial problem are evident where governmental policies create misallocation of resources and a hampering of technological development.

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Published in

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Mer för mindre? Tillväxt och hållbarhet i Sverige
BookPublication
Grafström, J. & Sandström, C.
Publication year

2020

Published in
Abstract

Går det att förena ekonomisk tillväxt med hållbar
utveckling? Den här boken beskriver hur miljöskadliga utsläpp och användningen av naturresurser i
Sverige har förändrats över tid.
Sedan 1990 har Sveriges befolkning ökat med drygt
1,6 miljoner och ekonomin nästan fördubblats. Samtidigt har koldioxidutsläppen minskat med 27 procent mellan åren 1990 och 2018, konsumtionen av
el, vatten och energi har stått still vilket innebär att
ekonomin är nästan dubbelt så effektiv. Av de 26
luftföroreningar Naturvårdsverket mätt sedan 1990
har 24 gått ner fram till 2017. I många fall har det
skett mer än en halvering.

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