Technological change plays a crucial role in realizing energy efficiency improvements and, therefore, in ameliorating the conflict between economic growth and environmental quality. However, the diffusion of new technologies can prove a costly and lengthy process, meaning that many firms do not invest in best-practice technologies. The author offers important new explanations for this energy-efficiency paradox. Contents: Part I: Introduction 1. Technological Change, Economic Growth and Energy Use 2. Economic Theory of Growth and Technological Change: A Neoclassical Versus an Evolutionary Perspective Part II: Theoretical Models 3. Explaining Slow Diffusion of Energy-Saving Technologies: Returns-to-Diversity and Learning-by-Using in a Vintage Model 4. Subsidizing the Adoption of Energy-Saving Technologies Part III: Empirical Analyses 5. International Comparisons of Sectoral Energy and Labour Productivity: Stylized Facts and Decomposition of Trends 6. Sectoral Energy and Labour Productivity Convergence Part IV: Policy Analyses and Conclusions 7. Dynamics of Technology Diffusion in an Applied Energy#Economic Model for the Netherlands 8. Conclusions References Index