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Effects of substituting energy with capital on China's aggregated energy and environmental efficiency

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  • Yang, Mian
  • Yang, Fu-Xia
  • Chen, Xing-Peng
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    Abstract

    Substituting energy with capital (SEC) in economic productions has become a common practice both for business owners and policy-makers to improve their energy and environmental efficiency. However, seldom previous studies on energy efficiency and/or environmental performance evaluation took this role into account. This paper aims to shed some light on the effects of SEC on China's aggregated energy and environmental efficiency (AEEE) within a parametric stochastic frontier analysis framework. Moreover, influencing factors of regional efficiency score are also discussed using a pooled regression model. The results indicate that SEC poses significant effects on improving China's AEEE, and this impact appears obvious regional variation that regions with lower efficiency scores hold more extensive potential to improve their AEEE by means of SEC. Furthermore, upgrading industrial structure and decreasing the proportion of coal in energy consumption make great sense to improve China's AEEE.

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    Bibliographic Info

    Article provided by Elsevier in its journal Energy Policy.

    Volume (Year): 39 (2011)
    Issue (Month): 10 (October)
    Pages: 6065-6072

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    Handle: RePEc:eee:enepol:v:39:y:2011:i:10:p:6065-6072

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    Web page: http://www.elsevier.com/locate/enpol

    Related research

    Keywords: Factor substitution Stochastic frontier analysis (SFA) China;

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    Cited by:
    1. Geraldine Henningsen & Arne Henningsen & Sascha T. Schröder & Simon Bolwig, 2014. "The Development of Environmental Productivity: the Case of Danish Energy Plants," IFRO Working Paper 2014/04, University of Copenhagen, Department of Food and Resource Economics.
    2. Yang, Fuxia & Yang, Mian & Nie, Hualin, 2013. "Productivity trends of Chinese regions: A perspective from energy saving and environmental regulations," Applied Energy, Elsevier, vol. 110(C), pages 82-89.

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