IDEAS home Printed from https://ideas.repec.org/p/eti/dpaper/13077.html
   My bibliography  Save this paper

On Biased Technical Change: Was technological change in Japan electricity-saving?

Author

Listed:
  • SATO Hitoshi

Abstract

Since the Great East Japan Earthquake, electricity generation has declined in Japan, and electricity prices have allegedly increased. The literature on biased technical change suggests that such electricity supply constraints may induce a biased technical change. This paper explores the extent to which the technical change in Japanese industries is biased, using a system of translog cost share equations where electricity and non-electric energy are separately treated as inputs. Using Japanese industry data over the 1973-2008 period, our findings confirm that technical change has been energy-saving but not electricity-saving in many industries, and that it tends to be labor-saving and capital-using. As a result, factor prices are much more important than technical change as a determinant of electricity's cost share.

Suggested Citation

  • SATO Hitoshi, 2013. "On Biased Technical Change: Was technological change in Japan electricity-saving?," Discussion papers 13077, Research Institute of Economy, Trade and Industry (RIETI).
    • Handle: RePEc:eti:dpaper:13077
    as

    Download full text from publisher

    File URL: https://www.rieti.go.jp/jp/publications/dp/13e077.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. HOSOE Nobuhiro & AKIYAMA Shu-ichi, 2008. "Regional Electric Power Demand in Japan," Discussion papers 08005, Research Institute of Economy, Trade and Industry (RIETI).
    2. Binswanger, Hans P, 1974. "The Measurement of Technical Change Biases with Many Factors of Production," American Economic Review, American Economic Association, vol. 64(6), pages 964-976, December.
    3. Antràs Pol, 2004. "Is the U.S. Aggregate Production Function Cobb-Douglas? New Estimates of the Elasticity of Substitution," The B.E. Journal of Macroeconomics, De Gruyter, vol. 4(1), pages 1-36, April.
    4. Diamond, Peter & McFadden, Daniel & Rodriguez, Miguel, 1978. "Measurement of the Elasticity of Factor Substitution and Bias of Technical Change," Histoy of Economic Thought Chapters, in: Fuss, Melvyn & McFadden, Daniel (ed.),Production Economics: A Dual Approach to Theory and Applications, volume 2, chapter 5, McMaster University Archive for the History of Economic Thought.
    5. Yuhn, Ky-hyang, 1991. "Economic Growth, Technical Change Biases, and the Elasticity of Substitution: A Test of the De La Grandville Hypothesis," The Review of Economics and Statistics, MIT Press, vol. 73(2), pages 340-346, May.
    6. Jin, Hui & Jorgenson, Dale W., 2010. "Econometric modeling of technical change," Journal of Econometrics, Elsevier, vol. 157(2), pages 205-219, August.
    7. Berndt, Ernst R, 1976. "Reconciling Alternative Estimates of the Elasticity of Substitution," The Review of Economics and Statistics, MIT Press, vol. 58(1), pages 59-68, February.
    8. Berndt, Ernst R & Wood, David O, 1975. "Technology, Prices, and the Derived Demand for Energy," The Review of Economics and Statistics, MIT Press, vol. 57(3), pages 259-268, August.
    9. Ichiro Fukunaga & Mitsuhiro Osada, 2009. "Measuring Energy-Saving Technical Change in Japan," Bank of Japan Working Paper Series 09-E-5, Bank of Japan.
    10. Fuss, Melvyn & McFadden, Daniel (ed.), 1978. "Production Economics: A Dual Approach to Theory and Applications," Elsevier Monographs, Elsevier, edition 1, number 9780444850133.
    11. Matsukawa Isamu & Madono Seishi & Nakashima Takako, 1993. "An Empirical Analysis of Ramsey Pricing in Japanese Electric Utilities," Journal of the Japanese and International Economies, Elsevier, vol. 7(3), pages 256-276, September.
    12. Julian R. Betts, 1997. "The Skill Bias Of Technological Change In Canadian Manufacturing Industries," The Review of Economics and Statistics, MIT Press, vol. 79(1), pages 146-150, February.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Johanna Vogel & Kurt Kratena & Kathrin Hranyai, 2015. "The Bias of Technological Change in Europe. WWWforEurope Working Paper No. 98," WIFO Studies, WIFO, number 58200, April.
    2. Zha, Donglan & Kavuri, Anil Savio & Si, Songjian, 2018. "Energy-biased technical change in the Chinese industrial sector with CES production functions," Energy, Elsevier, vol. 148(C), pages 896-903.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Michael Knoblach & Fabian Stöckl, 2020. "What Determines The Elasticity Of Substitution Between Capital And Labor? A Literature Review," Journal of Economic Surveys, Wiley Blackwell, vol. 34(4), pages 847-875, September.
    2. James Bessen, 2008. "Accounting for Productivity Growth When Technical Change is Biased," Working Papers 0802, Research on Innovation.
    3. James Bessen, 2009. "More Machines, Better Machines...Or Better Workers?," Working Papers 0803, Research on Innovation.
    4. Daniels, Jean M., 2010. "Assessing the lumber manufacturing sector in western Washington," Forest Policy and Economics, Elsevier, vol. 12(2), pages 129-135, February.
    5. Michael Knoblach & Martin Roessler & Patrick Zwerschke, 2020. "The Elasticity of Substitution Between Capital and Labour in the US Economy: A Meta‐Regression Analysis," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 82(1), pages 62-82, February.
    6. Ezra Oberfield & Devesh Raval, 2021. "Micro Data and Macro Technology," Econometrica, Econometric Society, vol. 89(2), pages 703-732, March.
    7. Gechert, Sebastian & Havranek, Tomas & Irsova, Zuzana & Kolcunova, Dominika, 2019. "Death to the Cobb-Douglas Production Function? A Quantitative Survey of the Capital-Labor Substitution Elasticity," EconStor Preprints 203136, ZBW - Leibniz Information Centre for Economics.
    8. Zha, Donglan & Kavuri, Anil Savio & Si, Songjian, 2017. "Energy biased technology change: Focused on Chinese energy-intensive industries," Applied Energy, Elsevier, vol. 190(C), pages 1081-1089.
    9. Antràs Pol, 2004. "Is the U.S. Aggregate Production Function Cobb-Douglas? New Estimates of the Elasticity of Substitution," The B.E. Journal of Macroeconomics, De Gruyter, vol. 4(1), pages 1-36, April.
    10. Julieta Caunedo & David Jaume & Elisa Keller, 2023. "Occupational Exposure to Capital-Embodied Technical Change," American Economic Review, American Economic Association, vol. 113(6), pages 1642-1685, June.
    11. Rainer Klump & Peter McAdam & Alpo Willman, 2012. "The Normalized Ces Production Function: Theory And Empirics," Journal of Economic Surveys, Wiley Blackwell, vol. 26(5), pages 769-799, December.
    12. Clemens Struck & Adnan Velic, 2017. "Automation, New Technology, and Non-Homothetic Preferences," Trinity Economics Papers tep1217, Trinity College Dublin, Department of Economics.
    13. Murgai, Rinku, 2001. "The Green Revolution and the productivity paradox: evidence from the Indian Punjab," Agricultural Economics, Blackwell, vol. 25(2-3), pages 199-209, September.
    14. Knoblach, Michael & Rößler, Martin & Zwerschke, Patrick, 2016. "The Elasticity of Factor Substitution Between Capital and Labor in the U.S. Economy: A Meta-Regression Analysis," CEPIE Working Papers 03/16, Technische Universität Dresden, Center of Public and International Economics (CEPIE).
    15. Daan Steenkamp, 2018. "Factor Substitution and Productivity in New Zealand," The Economic Record, The Economic Society of Australia, vol. 94(304), pages 64-79, March.
    16. Ewis, Nabil A., 1983. "A Neoclassical Analysis of the Demand for Cereals in Egypt," Working Papers 243426, University of California, Davis, Agricultural Development Systems: Egypt Project.
    17. Abdullah, Maisom, 1989. "Capital-labor substitutability in Malaysian manufacturing: alternative estimates and policy implications," ISU General Staff Papers 198901010800009905, Iowa State University, Department of Economics.
    18. Perez-Laborda, Alejandro & Perez-Sebastian, Fidel, 2020. "Capital-skill complementarity and biased technical change across US sectors," Journal of Macroeconomics, Elsevier, vol. 66(C).
    19. Zuzana Smeets Kristkova & Cornelis Gardebroek & Michiel van Dijk & Hans van Meijl, 2017. "The impact of R&D on factor-augmenting technical change – an empirical assessment at the sector level," Economic Systems Research, Taylor & Francis Journals, vol. 29(3), pages 385-417, July.
    20. Jesus Felipe & John S.L. McCombie, 2013. "The Aggregate Production Function and the Measurement of Technical Change," Books, Edward Elgar Publishing, number 1975.

    More about this item

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eti:dpaper:13077. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: TANIMOTO, Toko (email available below). General contact details of provider: https://edirc.repec.org/data/rietijp.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.