This paper investigates the substitutability between energy and capital in the manufacturing sectors of ten OECD countries since 1980 by applying a cost function approach that has been widely used to analyze industrial energy demand. First, we attempt to determine the source of the disagreement...

Shadow price is one of the most important pieces of information in environmental decision making. Two different approaches—namely, economic and engineering—have been applied to obtain the shadow price of undesirable outputs, while using different methodological backgrounds and perspectives....