Endogenous Growth Model for China's Green IT Based on Green Technology and Green Society

Abstract

China's green IT development is faced with the unique “IT social risk”. Therefore, the endogenesis of China's green IT development has been challenged. Using the concept of “society greening”, we divide a green IT system into a technology greening sub-system and a society greening sub-system, based on which an endogenous growth model was built. Using an optimal control method to solve the model, we find the long-term equilibrium rate of economic growth, transversality conditions, the relationship between the output flexibilities of the input factors in the two sub-systems, the relationship among the elasticity coefficients of intertemporal substitution in consumption, as well as the optimal conditions for the whole system. The results show that to allow China's green IT to develop, the output elasticity of the society greening sub-system knowledge must be higher than that of the technology greening sub-system. This urgently requires government incentives and other public products to balance the investment efficiency in the two sub-systems.