Modeling China's energy consumption behavior and changes in energy intensity

China's demand for energy has grown to fuel its rapidly expanding industrial, commercial and consumer sectors. At the same time, China has become the second largest consumer of petroleum products having surpassed Japan for the first time in 2003. The environmental consequences of a continuation...

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Main Authors: Ma, H., Oxley, Leslie, Gibson, J., Kim, B.
Format: Journal Article
Published: Pergamon 2009
Online Access:http://hdl.handle.net/20.500.11937/19729
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author Ma, H.
Oxley, Leslie
Gibson, J.
Kim, B.
author_facet Ma, H.
Oxley, Leslie
Gibson, J.
Kim, B.
author_sort Ma, H.
building Curtin Institutional Repository
collection Online Access
description China's demand for energy has grown to fuel its rapidly expanding industrial, commercial and consumer sectors. At the same time, China has become the second largest consumer of petroleum products having surpassed Japan for the first time in 2003. The environmental consequences of a continuation of these trends will have global implications. Government policies and consumers have become more environmentally aware, but the ability of governments to formulate policies has been hindered by the lack of data on inter-factor and inter-fuel substitution possibilities. In this paper Allen partial elasticities of factor and energy substitution, and price elasticities of energy demand are calculated for China's industrial economy using a two-stage translog cost function approach for the period 1995-2004. The results suggest that energy is substitutable with both capital and labor. Coal is significantly substitutable with electricity and slightly complementary with oil, while oil and electricity are slightly substitutable. China's energy intensity is increasing during the study period and the major driver appears to be due to the increased use of energy-intensive technology. © 2009 Elsevier Ltd. All rights reserved.
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spelling curtin-20.500.11937-197292017-09-13T13:51:03Z Modeling China's energy consumption behavior and changes in energy intensity Ma, H. Oxley, Leslie Gibson, J. Kim, B. China's demand for energy has grown to fuel its rapidly expanding industrial, commercial and consumer sectors. At the same time, China has become the second largest consumer of petroleum products having surpassed Japan for the first time in 2003. The environmental consequences of a continuation of these trends will have global implications. Government policies and consumers have become more environmentally aware, but the ability of governments to formulate policies has been hindered by the lack of data on inter-factor and inter-fuel substitution possibilities. In this paper Allen partial elasticities of factor and energy substitution, and price elasticities of energy demand are calculated for China's industrial economy using a two-stage translog cost function approach for the period 1995-2004. The results suggest that energy is substitutable with both capital and labor. Coal is significantly substitutable with electricity and slightly complementary with oil, while oil and electricity are slightly substitutable. China's energy intensity is increasing during the study period and the major driver appears to be due to the increased use of energy-intensive technology. © 2009 Elsevier Ltd. All rights reserved. 2009 Journal Article http://hdl.handle.net/20.500.11937/19729 10.1016/j.envsoft.2009.04.011 Pergamon restricted
spellingShingle Ma, H.
Oxley, Leslie
Gibson, J.
Kim, B.
Modeling China's energy consumption behavior and changes in energy intensity
title Modeling China's energy consumption behavior and changes in energy intensity
title_full Modeling China's energy consumption behavior and changes in energy intensity
title_fullStr Modeling China's energy consumption behavior and changes in energy intensity
title_full_unstemmed Modeling China's energy consumption behavior and changes in energy intensity
title_short Modeling China's energy consumption behavior and changes in energy intensity
title_sort modeling china's energy consumption behavior and changes in energy intensity
url http://hdl.handle.net/20.500.11937/19729