These figures were calculated using the government's state of the art model that computes the wider "dynamic" impact to the whole economy of tax changes rather than just the "static" cost to the exchequer.
I have asked the Treasury more questions (in particular I'm keen to know what they use as a "static cost" of the policy, and their GDP assumptions) and will return with a more analytical take on it as soon as possible.
Firstly the "static cost" over this parliament is £22.5bn, however when they were comparing the "recovery rate" at which higher revenues from other activities helped to compensate for the loss of income from fuel duty they did assume a loss of income in each year after this parliament.
It provides a full-cost model that does not account only for the dynamic energy consumption of a given VM, but also includes the proportional static cost of using a Cloud infrastructure.
Meanwhile, a decision about whether to continue support for bioelectricity production should not be based on static cost-effectiveness considerations alone especially if such an evaluation is based on comparing bioelectricity's generation costs with the vRES wind and solar, the former's option value for flexibility provision may be overlooked.
These efforts have extended from earlier work emphasizing the essentially static, cost-based advantages gained by the adjacent location of activities linked by flows of materials or semifinished goods to a more recent focus upon the role of proximity in facilitating the circulation of information and ideas between firms.
Beyond such "static cost-effectiveness," cap-and-trade creates incentives for technology innovation, and thereby lowers long-run costs.
(5) c t = α 1 E t + α 2 E 2 t ⏞ Static Cost + α 3 E ˙ t + μ 2 ⏞ Dynamic Cost where the α parameters are strictly positive and quantify the relative importance of the static cost to the dynamic cost.
A static cost-effectiveness model developed for pandemic influenza, 102 has been shown to stimulate interest and further country-specific economic research (Meltzer MI, personal communication) and could have the same effect for dengue.
The static cost is due to the presence of a given amount E of total enzyme, which causes the sequestration of enzyme building blocks (resource R S, e.g. amino acids), leading to a nonlinear dependence on E (see Materials and Methods).
