Direct and indirect energy consumption in China and the United States

LIU, H. and POLENSKE, K. R. and GUILHOTO, J. J. M. and XI, Y. (2011): Direct and indirect energy consumption in China and the United States. Published in:

Abstract

Greenhouse gas reduction and energy consumption are becoming two important issues in both industrialized and developing countries, and policy makers are developing means to reduce total domestic energy use. We evaluate and compare the direct and the indirect energy consumption both in the People’s Republic of China (China) and the United States of America (US) by looking at a series of hybrid energy input-output tables (1997, 2002, and 2007). We also apply structural decomposition analysis (SDA), to identify the factors causing energy intensity (energy consumption per unit of gross domestic product) to differ between the two countries, which lead to potential energy-saving options. Our results show that, besides the differences in direct energy consumption, huge differences also exist in indirect energy consumption between the two countries. Differences in indirect energy consumption are mainly due to differences in technology. Technological change and industrial-structure change are key factors to explain the inequality of energy intensity, while there is a significant trend towards the convergence of sectorial energy efficiency between the two countries.

• Item Type: MPRA Paper
• Language: English
• Keywords: Input-output analysis, Structural decomposition analysis, Energy
• Subjects: D - Microeconomics > D5 - General Equilibrium and Disequilibrium > D57 - Input-Output Tables and Analysis; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q4 - Energy

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