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On the Use of Double-Log Forms in Energy Demand Analysis

Author

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  • Andre Plourde
  • David Ryan

Abstract

The double-logarithmic demand function has been used widely in static energy demand studies. Recent examples include studies of electricity demand by Betancourt (1981) and Dias-Bandaranaike and Munasinghe (1983), of petroleum consumption by Brown (1983), and natural gas demand by Gowdy (1983). In this paper we examine some theoretical issues on the use of these functional forms in energy demand analysis and note a few related problems. Our analysis draws from the study by Dias-Bandaranaike and Munasinghe (1983) (hereafter DBM) recently published in The Energy Journal, Volume 4, Number 2. We concentrate on this paper for several reasons. First, it examines some of the theoretical underpinnings of doublelog demand functions. Second, the authors claim that one of the contributions of their study is "[an] approach ... to derive demand functions [that] could be used to derive similar functions for other types of goods and services, besides electricity". Third, their study inadvertently reveals a number of problems that arise when the overriding concern is obtaining demand equations of the double-log form.

Suggested Citation

  • Andre Plourde & David Ryan, 1985. "On the Use of Double-Log Forms in Energy Demand Analysis," The Energy Journal, International Association for Energy Economics, vol. 0(Number 4), pages 105-113.
    • Handle: RePEc:aen:journl:1985v06-04-a08
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    Cited by:

    1. Alptekin, Aynur & Broadstock, David C. & Chen, Xiaoqi & Wang, Dong, 2019. "Time-varying parameter energy demand functions: Benchmarking state-space methods against rolling-regressions," Energy Economics, Elsevier, vol. 82(C), pages 26-41.
    2. World Bank, 2011. "A New Slant on Slopes : Measuring the Benefits of Increased Electricity Access in Developing Countries," World Bank Publications - Reports 2742, The World Bank Group.
    3. Holtedahl, Pernille & Joutz, Frederick L., 2004. "Residential electricity demand in Taiwan," Energy Economics, Elsevier, vol. 26(2), pages 201-224, March.
    4. Ryan, David L. & Plourde, Andre, 2002. "Smaller and smaller? The price responsiveness of nontransport oil demand," The Quarterly Review of Economics and Finance, Elsevier, vol. 42(2), pages 285-317.
    5. Dingding Li & Thanasis Stengos, 2003. "Testing Serial Correlation in Semiparametric Time Series Models," Journal of Time Series Analysis, Wiley Blackwell, vol. 24(3), pages 311-335, May.
    6. Silk, Julian I. & Joutz, Frederick L., 1997. "Short and long-run elasticities in US residential electricity demand: a co-integration approach," Energy Economics, Elsevier, vol. 19(4), pages 493-513, October.
    7. Krishnamurthy, Chandra Kiran B. & Kriström, Bengt, 2015. "A cross-country analysis of residential electricity demand in 11 OECD-countries," Resource and Energy Economics, Elsevier, vol. 39(C), pages 68-88.
    8. Kiran B Krishnamurthy, Chandra & Kriström, Bengt, 2013. "A cross-country analysis of residential electricity demand in 11 OECD-countries," CERE Working Papers 2013:5, CERE - the Center for Environmental and Resource Economics, revised 30 Jun 2014.

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    JEL classification:

    • F0 - International Economics - - General

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