Environmental Economics & Policy 6th Edition by Tom Tietenberg,Lynne Lewis

Exercise 1

It has been suggested that we should use the "net energy" criterion to make choices among various types of energy. Net energy is defined as the total energy content in the energy source minus the energy required to extract, process, and deliver it to consumers. According to this criterion, we should use those sources with the highest net energy content first. Would the dynamic efficiency criterion and the net energy criterion be expected to yield the same choice? Why or why not?