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Why did the energy intensity fall in China's industrial sector in the 1990s? the relative importance of structural change and intensity change

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Zhang, ZhongXiang

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Abstract

There have been a variety of studies investigating the relative importance of structural change and real intensity change to the change in China’s energy consumption in the 1980s. However, no detailed analysis to date has been done to examine whether or not the increased energy efficiency trend in the 1980s still prevailed in the 1990s. This article has filled this gap by investigating the change in energy consumption in China’s industrial sector in the 1990s, based on the data sets of value added and end-use energy consumption for the 29 industrial subsectors and using the newly proposed decomposition method of giving no residual. Our results clearly show that the overwhelming contributor to the decline in industrial energy use in the 1990s was the decline in real energy intensity, indicating that the trend of real energy intensity declines in the 1980s at the 2-digit level was still maintained in the 1990s. This conclusion still holds even if we lower the growth rate dramatically in line with the belief that the growth rate of China’s GDP may be overestimated.

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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 13149.

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Date of creation: Dec 2001
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Handle: RePEc:pra:mprapa:13149

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Related research
Keywords: China; decomposition method; energy; structural change; energy intensity change;

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Find related papers by JEL classification:
Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

References listed on IDEAS
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  1. Keidel, Albert, 2001. "China's GDP expenditure accounts," China Economic Review, Elsevier, vol. 12(4), pages 355-367. [Downloadable!] (restricted)
  2. G. Boyd & J. F. McDonald & M. Ross & D. A. Hansont, 1987. "Separating the Changing Composition of U.S. Manufacturing Production from Energy Efficiency Improvements: A Divisia Index Approach," The Energy Journal, International Association for Energy Economics, vol. 8(2), pages 77-96.
  3. Sinton, Jonathan E. & Levine, Mark D., 1994. "Changing energy intensity in Chinese industry : The relatively importance of structural shift and intensity change," Energy Policy, Elsevier, vol. 22(3), pages 239-255, March. [Downloadable!] (restricted)
  4. Ang, B. W. & Lee, S. Y., 1994. "Decomposition of industrial energy consumption : Some methodological and application issues," Energy Economics, Elsevier, vol. 16(2), pages 83-92, April. [Downloadable!] (restricted)
  5. Boyd, Gale A. & Hanson, Donald A. & Sterner, Thomas, 1988. "Decomposition of changes in energy intensity : A comparison of the Divisia index and other methods," Energy Economics, Elsevier, vol. 10(4), pages 309-312, October. [Downloadable!] (restricted)
  6. Park, Se-Hark, 1992. "Decomposition of industrial energy consumption : An alternative method," Energy Economics, Elsevier, vol. 14(4), pages 265-270, October. [Downloadable!] (restricted)
  7. X. Q. Liu & B. W. Ang & H.L. Ong, 1992. "The Application of the Divisia Index to the Decomposition of Changes in Industrial Energy Consumption," The Energy Journal, International Association for Energy Economics, vol. 13(4), pages 161-178.
  8. Howarth, Richard B. & Schipper, Lee & Duerr, Peter A. & Strøm, Steinar, 1991. "Manufacturing energy use in eight OECD countries : Decomposing the impacts of changes in output, industry structure and energy intensity," Energy Economics, Elsevier, vol. 13(2), pages 135-142, April. [Downloadable!] (restricted)
  9. Neary, J. P. & Roberts, K. W. S., 1980. "The theory of household behaviour under rationing," European Economic Review, Elsevier, vol. 13(1), pages 25-42, January. [Downloadable!] (restricted)
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  1. Xingjun Zhao & Yanrui Wu, 2007. "Determinants of China’s Energy Imports: An Empirical Analysis," Economics Discussion / Working Papers 07-03, The University of Western Australia, Department of Economics. [Downloadable!]
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