IDEAS home Printed from https://ideas.repec.org/a/bla/coecpo/v15y1997i4p1-9.html
   My bibliography  Save this article

Energy Efficiency And Economic Growth

Author

Listed:
  • RICHARD B. HOWARTH

Abstract

Recent contributions by Brookes (1990), Saunders (1992), and Inhaber and Saunders (1994) argue that cost‐effective improvements in energy efficiency may, in the long run, lead energy use to grow more rapidly than it would in a world of fixed technologies. Since efficiency improvements may be viewed as a form of technological change that both reduces the effective cost of energy services and stimulates economic activity, energy demand may, under some circumstances, rise even as energy productivity improves. This paper examines this hypothesis using a simple model that distinguishes the roles of energy and energy services in production activities. In this model, improved energy efficiency can‐not give rise to increased energy use unless: (i) energy costs dominate the total cost of energy services and (ii) expenditures on energy services constitute a large share of economic activity. Since neither of these assumptions is empirically plausible, the paper concludes that energy efficiency improvements will yield long‐run reductions in energy use under the assumptions of the model.

Suggested Citation

  • Richard B. Howarth, 1997. "Energy Efficiency And Economic Growth," Contemporary Economic Policy, Western Economic Association International, vol. 15(4), pages 1-9, October.
    • Handle: RePEc:bla:coecpo:v:15:y:1997:i:4:p:1-9
    DOI: 10.1111/j.1465-7287.1997.tb00484.x
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/j.1465-7287.1997.tb00484.x
    Download Restriction: no

    References listed on IDEAS

    as
    1. Brookes, Len, 1990. "The greenhouse effect: the fallacies in the energy efficiency solution," Energy Policy, Elsevier, vol. 18(2), pages 199-201, March.
    2. Sanstad, Alan H. & Howarth, Richard B., 1994. "`Normal' markets, market imperfections and energy efficiency," Energy Policy, Elsevier, vol. 22(10), pages 811-818, October.
    3. Robert M. Solow, 1956. "A Contribution to the Theory of Economic Growth," The Quarterly Journal of Economics, Oxford University Press, vol. 70(1), pages 65-94.
    4. J. Daniel Khazzoom, 1980. "Economic Implications of Mandated Efficiency in Standards for Household Appliances," The Energy Journal, International Association for Energy Economics, vol. 0(Number 4), pages 21-40.
    5. Grubb, M. J., 1990. "Communication Energy efficiency and economic fallacies," Energy Policy, Elsevier, vol. 18(8), pages 783-785, October.
    6. Richard B. Howarth & Lee Schipper & Bo Andersson, 1993. "The Structure and Intensity of Energy Use: Trends in Five OECD Nations," The Energy Journal, International Association for Energy Economics, vol. 0(Number 2), pages 27-46.
    7. Brookes, L. G., 1992. "Energy efficiency and economic fallacies: a reply," Energy Policy, Elsevier, vol. 20(5), pages 390-392, May.
    8. Dumagan, Jesus C. & Mount, Timothy D., 1993. "Welfare effects of improving end-use efficiency: Theory and application to residential electricity demand," Resource and Energy Economics, Elsevier, vol. 15(2), pages 175-201, June.
    9. Ronald J. Sutherland, 1991. "Market Barriers to Energy-Efficiency Investments," The Energy Journal, International Association for Energy Economics, vol. 0(Number 3), pages 15-34.
    10. STEPHEN J. DeCANIO, 1997. "Economic Modeling And The False Tradeoff Between Environmental Protection And Economic Growth," Contemporary Economic Policy, Western Economic Association International, vol. 15(4), pages 10-27, October.
    11. Solow, John L, 1987. "The Capital-Energy Complementarity Debate Revisited," American Economic Review, American Economic Association, vol. 77(4), pages 605-614, September.
    12. Brookes, L. G., 1993. "Energy efficiency fallacies: the debate concluded," Energy Policy, Elsevier, vol. 21(4), pages 346-347, April.
    13. Alan Manne & Richard Richels, 1992. "Buying Greenhouse Insurance: The Economic Costs of CO2 Emission Limits," MIT Press Books, The MIT Press, edition 1, volume 1, number 026213280x, December.
    14. Howarth, Richard B. & Andersson, Bo, 1993. "Market barriers to energy efficiency," Energy Economics, Elsevier, vol. 15(4), pages 262-272, October.
    15. Scott, Alex, 1980. "The economics of house heating," Energy Economics, Elsevier, vol. 2(3), pages 130-141, July.
    16. Harty D. Saunders, 1992. "The Khazzoom-Brookes Postulate and Neoclassical Growth," The Energy Journal, International Association for Energy Economics, vol. 0(Number 4), pages 131-148.
    Full references (including those not matched with items on IDEAS)

    More about this item

    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:bla:coecpo:v:15:y:1997:i:4:p:1-9. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Wiley Content Delivery). General contact details of provider: http://edirc.repec.org/data/weaaaea.html .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.