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Electricity consumption and economic development: Are countries converging to a common trend?

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  • Kim, Young Se

Abstract

This paper studies the dynamic behavior of electricity consumption with special emphasis on their convergence patterns. Individual electricity indicators are modeled by allowing for apparent heterogeneous transitions. Log t convergence test results indicate that all 109 countries converge to a common stochastic trend for electricity intensity while per capita electricity consumption is better explained by a multiple-component model. In the case of 24 advanced economies, there is a strong tendency towards a common component for both indicators. The application of clustering algorithm confirms the presence of club convergence for per capita electricity consumption. In terms of clustering pattern, per capita electricity consumption appears to be remarkably similar to per capita income, widely used measure of economic development.

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  • Kim, Young Se, 2015. "Electricity consumption and economic development: Are countries converging to a common trend?," Energy Economics, Elsevier, vol. 49(C), pages 192-202.
    • Handle: RePEc:eee:eneeco:v:49:y:2015:i:c:p:192-202
    DOI: 10.1016/j.eneco.2015.02.001
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    More about this item

    Keywords

    Relative convergence; Clustering analysis; Electricity intensity; Electricity consumption; Economic development; Income convergence;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • C38 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Classification Methdos; Cluster Analysis; Principal Components; Factor Analysis
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • 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
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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