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Energy Intensity of Indian Manufacturing Firms: Effect of Energy Prices, Technology and Firm Characteristics

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  • Bishwanath Goldar
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    Abstract

    The paper examines the factors that influence energy intensity in Indian industries. It has two parts. In the first part, trends in energy intensity are analysis and cross-industry panel data (taken from ASI) are used to estimate an energy demand function. The results show that energy demand responds negatively to a hike in energy prices and positively to a hike in real wages. There are indications from the results of the analysis that the post- 1992 decline in energy intensity of Indian manufacturing is attributable mostly to an improvement in energy use efficiency of energy intensive industries, which in turn may be traced to hikes in the real price of energy paid by manufacturing firms.

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    Bibliographic Info

    Paper provided by eSocialSciences in its series Working Papers with number id:2483.

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    Date of creation: May 2010
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    Handle: RePEc:ess:wpaper:id:2483

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    Related research

    Keywords: ASI; prices; technology; industries; demand; energy; real wages; Indian; manufacturing; real price; manufacturing firms;

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    1. Binay Kumar Ray & B. Sudhakara Reddy, 2007. "Decomposition of energy consumption and energy intensity in Indian manufacturing industries," Indira Gandhi Institute of Development Research, Mumbai Working Papers 2007-020, Indira Gandhi Institute of Development Research, Mumbai, India.
    2. Pindyck, Robert S, 1979. "Interfuel Substitution and the Industrial Demand for Energy: An International Comparison," The Review of Economics and Statistics, MIT Press, vol. 61(2), pages 169-79, May.
    3. Mukherjee, Kankana, 2008. "Energy use efficiency in the Indian manufacturing sector: An interstate analysis," Energy Policy, Elsevier, vol. 36(2), pages 662-672, February.
    4. Sahu, Santosh & Narayanan, K, 2009. "Determinants of Energy Intensity: A Preliminary Investigation of Indian Manufacturing," MPRA Paper 16606, University Library of Munich, Germany.
    5. Kemfert, Claudia & Welsch, Heinz, 2000. "Energy-Capital-Labor Substitution and the Economic Effects of CO2 Abatement: Evidence for Germany," Journal of Policy Modeling, Elsevier, vol. 22(6), pages 641-660, November.
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