Capital and labour markets - WITNESS
Capital
The capital equation is: Kt=It+(1−δ)Kt−1 with It the investment in trillions dollars, and δ the depreciation rate.
Each period the capital stock increases with new investment and decreases with depreciation of past period capital.
The capital is divided into two types: energy capital and non energy capital.
Energy capital is the capital dedicated to energy production. The remaining capital stock is then the non-energy capital.
The equation above is applied to both energy and non energy capital, the total capital stock being the sum.
We apply to non energy capital the depreciation rate in input (depreciation rate) of this model.
For energy capital the depreciation rate depends on the technology, the energy capital is therefore computed in each energy technology model and is an input of the macroeconomics model.
As explained in Macro-economy documentation, capital need to be matched by proper energy, labor and resources to be productive (see Unused capital objective model)
Labor force
To obtain the labor force we use the population in working age and the employment rate.
We defined the population in working age as the population in the 15-70 age range (coming from the Population model). L= workingagepop ∗ employmentrate
Level of knowledge for this population is also available from Population model but not used yet.
The employment rate is for now fixed at 65.9 following International Labour Organization data.
However to take into account the impact of COVID-19 crisis on employment rate, the value is different for 2020-2031 year interval.
We used ILO forecast values for 2021, 2022 and 2023 to extrapolate a recovery function until fixed value is reached.
Note: The documentation of WITNESS is 'in preparation' and is not yet 'published'!| Corresponding documentation | |
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| Previous versions | |
| No previous version available | |
| Model information | |
| Model link | |
| Institution | Open-Source for Climate (OS-C), N/A, https://os-climate.org/transition-analysis/., Linux Foundation (LF), N/A, https://www.linuxfoundation.org/. |
| Solution concept | Systems dynamics based approach |
| Solution method | OptimizationSimulation-based optimization |
| Anticipation | |