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Energy distribution and economic growth: An empirical test for China

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  • Elliott, Robert J.R.
  • Sun, Puyang
  • Xu, Qiqin

Abstract

In this paper we consider whether economic growth in China could be constrained by the physical development of the energy distribution network. Specifically, we structurally test the network theory of electricity distribution of Dalgaard and Strulik (2011) using city level data for China. In their paper they argue that the relationship between the size of the economy, measured by capital per capita, and electricity consumption per capita is governed by a simple power law with capital having an exponent bounded between ½ and ¾ depending on the efficiency of the network. We use data for 224 cities in China between 2002 and 2007 to observe whether structural estimates match those of Dalgaard and Strulik (2011) for 50 US states where they find the exponent in the power law connecting capital with electricity to be 2/3. Our results provide an estimate of the power law component to a little higher than the 2/3 found for the US which provides broad support for the model. When we look at different time periods we observe what appears to be a fall in the efficiency of the energy distribution network towards the end of our period.

Suggested Citation

  • Elliott, Robert J.R. & Sun, Puyang & Xu, Qiqin, 2015. "Energy distribution and economic growth: An empirical test for China," Energy Economics, Elsevier, vol. 48(C), pages 24-31.
    • Handle: RePEc:eee:eneeco:v:48:y:2015:i:c:p:24-31
    DOI: 10.1016/j.eneco.2014.11.016
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    Citations

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    Cited by:

    1. Huanying Cui, 2016. "China s Economic Growth and Energy Consumption," International Journal of Energy Economics and Policy, Econjournals, vol. 6(2), pages 349-355.
    2. Rafindadi, Abdulkadir Abdulrashid & Ozturk, Ilhan, 2016. "Effects of financial development, economic growth and trade on electricity consumption: Evidence from post-Fukushima Japan," Renewable and Sustainable Energy Reviews, Elsevier, vol. 54(C), pages 1073-1084.
    3. Elliott, Robert J.R. & Sun, Puyang & Zhu, Tong, 2017. "The direct and indirect effect of urbanization on energy intensity: A province-level study for China," Energy, Elsevier, vol. 123(C), pages 677-692.
    4. Khalili-Damghani, Kaveh & Tavana, Madjid & Santos-Arteaga, Francisco J. & Mohtasham, Sima, 2015. "A dynamic multi-stage data envelopment analysis model with application to energy consumption in the cotton industry," Energy Economics, Elsevier, vol. 51(C), pages 320-328.
    5. Damilola Elizabeth Babatunde & Olubayo Moses Babatunde & Tolulope Olusegun Akinbulire & Peter Olabisi Oluseyi, 2018. "Hybrid Energy Systems Model with the Inclusion of Energy Efficiency Measures: A Rural Application Perspective," International Journal of Energy Economics and Policy, Econjournals, vol. 8(4), pages 310-323.
    6. Huang, Jiashun & Li, Weiping & Guo, Lijia & Hu, Xi & Hall, Jim W., 2020. "Renewable energy and household economy in rural China," Renewable Energy, Elsevier, vol. 155(C), pages 669-676.
    7. Salim, Ruhul & Yao, Yao & Chen, George S., 2017. "Does human capital matter for energy consumption in China?," Energy Economics, Elsevier, vol. 67(C), pages 49-59.

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    More about this item

    Keywords

    Energy; Electricity; Economic growth; China;
    All these keywords.

    JEL classification:

    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • P28 - Political Economy and Comparative Economic Systems - - Socialist and Transition Economies - - - Natural Resources; Environment
    • P48 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies

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