IDEAS home Printed from https://ideas.repec.org/a/eee/appene/v331y2023ics0306261922016993.html

Factor substitution and development path of the new energy market in the BRICS countries under carbon neutrality: Inspirations from developed European countries

Author

Listed:
  • Pan, Yuling
  • Dong, Feng

Abstract

Carbon neutrality is proposed by many countries for responding to climate change and energy transformation. Developing new energy is crucial to achieving carbon neutrality goals. In the context of carbon neutrality, this paper analyzes the factor structure and market orientation of the new energy market in BRICS countries (including the Federative Republic of Brazil, Russian Federation, the Republic of India, People’s Republic of China, and the Republic of South Africa) and developed European (DE) countries in recent years. The primary conclusions are as follows: (1) In wind and solar energy markets, the BRICS countries exhibit an elastic substitution effect in production, indicating they have chosen the expansionary strategy with unbalanced factors. Through the contribution analysis, we find the development of wind and solar energy in BRICS countries is capital-oriented. However, the DE countries have opted for a conservative strategy with balanced factors, in which the wind and solar energy markets need promotional measures for capital investment and technological progress. (2) In the biomass energy market, both the BRICS countries and DE countries adopt the expansionary strategy. Besides, the development of the biomass energy market is technology-oriented except for India. (3) For the nuclear energy market, the BRICS countries and DE countries choose the conservative strategy and expansionary strategy, respectively. However, due to safety concerns, the expansion of nuclear energy in all countries has slowed. (4) Although a capital-oriented strategy can quickly promote the development of the new energy market, this practice compromises the local welfare and the benefits of the new energy technology progress to varying extents. The core insight of this paper is that BRICS countries should avoid the new energy capital trap and prevent the new energy technology dilemma. For the BRICS countries, policymakers should further evaluate the balance between capital-oriented interest and technology-oriented development. Also, achieving carbon neutrality is more difficult for the BRICS countries than DE countries. Hence, the BRICS countries should further refine their energy strategies for the long term.

Suggested Citation

  • Pan, Yuling & Dong, Feng, 2023. "Factor substitution and development path of the new energy market in the BRICS countries under carbon neutrality: Inspirations from developed European countries," Applied Energy, Elsevier, vol. 331(C).
    • Handle: RePEc:eee:appene:v:331:y:2023:i:c:s0306261922016993
    DOI: 10.1016/j.apenergy.2022.120442
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0306261922016993
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.apenergy.2022.120442?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Sebastian Gechert & Tomas Havranek & Zuzana Irsova & Dominika Kolcunova, 2022. "Measuring Capital-Labor Substitution: The Importance of Method Choices and Publication Bias," Review of Economic Dynamics, Elsevier for the Society for Economic Dynamics, vol. 45, pages 55-82, July.
    2. Kemfert, Claudia, 1998. "Estimated substitution elasticities of a nested CES production function approach for Germany," Energy Economics, Elsevier, vol. 20(3), pages 249-264, June.
    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. Yang, Bo & Liang, Boxiao & Zhou, Shuai & Qian, Yucun & Zheng, Ruyi & Shu, Hongchun & He, Peng & Wang, Jingbo & Jiang, Lin & Sang, Yiyan & Li, Hongbiao, 2026. "A novel bio-inspired caterpillar fungus (Ophiocordyceps sinensis) optimizer for SOFC parameter identification via GRNN," Renewable Energy, Elsevier, vol. 256(PB).
    2. Pan, Yuling & Dong, Feng, 2023. "Green finance policy coupling effect of fossil energy use rights trading and renewable energy certificates trading on low carbon economy: Taking China as an example," Economic Analysis and Policy, Elsevier, vol. 77(C), pages 658-679.
    3. Wang, Yubao & Zhen, Junjie, 2024. "Drivers and strategic options for renewable energy development in China: LMDI-elasticity analysis perspective based on photovoltaic and wind energy," Energy, Elsevier, vol. 309(C).
    4. Yu, Bolin & Fang, Debin & Pan, Yuling & Jia, Yunxia, 2023. "Countries’ green total-factor productivity towards a low-carbon world: The role of energy trilemma," Energy, Elsevier, vol. 278(PB).
    5. Zhong, Wenli & Liu, Yang & Dong, Kangyin & Ni, Guohua, 2024. "Assessing the synergistic effects of artificial intelligence on pollutant and carbon emission mitigation in China," Energy Economics, Elsevier, vol. 138(C).
    6. Amin, Nabila & Sharif, Arshian & Shabbir, Muhammad Salman & Pan, Yanchun, 2025. "Evaluating the impact of natural resource rents, R&D expenditures, green finance and energy efficiency on carbon emissions in BRICS economies: Greening the path to carbon neutrality in the post-COP 27 era," Technology in Society, Elsevier, vol. 81(C).
    7. Bi-Huei Tsai & Yao-Min Huang, 2023. "Comparing the Substitution of Nuclear Energy or Renewable Energy for Fossil Fuels between the United States and Africa," Sustainability, MDPI, vol. 15(13), pages 1-16, June.
    8. Fang, Guochang & Zhou, Huixin & Meng, Aoxiang & Tian, Lixin, 2024. "How to crack the impossible triangle of new energy coupled system——Evidence from China," Applied Energy, Elsevier, vol. 374(C).
    9. Liu, Yajie & Dong, Feng & Li, Guoqing & Huang, Jianheng & Yang, Shanshan & Wang, Yulong, 2023. "Public willingness to support the policy of banning gasoline vehicles sales and its internal mechanism," Energy, Elsevier, vol. 271(C).
    10. Jianquan Guo & Yinan Zhang, 2024. "How does Low-Carbon Development of Logistics and Tourism Contribute to China’s Economy? Evidence from Technological Innovation and Renewable Energy," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 15(4), pages 18378-18411, December.
    11. Liu, Baoliu & Huang, Yujie & Chen, Mengmei & Lan, Zirui, 2024. "Towards sustainability: How does the digital-real integration affect regional green development efficiency?," Economic Analysis and Policy, Elsevier, vol. 83(C), pages 42-59.
    12. Yu, Bolin & Fang, Debin & Xiao, Kun & Pan, Yuling, 2023. "Drivers of renewable energy penetration and its role in power sector's deep decarbonization towards carbon peak," Renewable and Sustainable Energy Reviews, Elsevier, vol. 178(C).
    13. Zhang, Xiufeng & Yan, Tong & Zhang, Shengxin & Zhang, Zhenhua & Feng, Yanchao, 2025. "Assessing the synergy reduction effects of the renewable energy policies on environmental pollution and carbon emissions in China," International Review of Financial Analysis, Elsevier, vol. 105(C).
    14. Zhao, Zhenyu & Xu, Hanting & Bao, Geriletu, 2025. "Two-stage clustering-focusing measurement modeling for national new energy market development level: An empirical analysis of 81 economies," Energy, Elsevier, vol. 340(C).
    15. Yang Tang & Yifeng Liu & Weiqiang Huo & Meng Chen & Shilong Ye & Lei Cheng, 2023. "Optimal Allocation Scheme of Renewable Energy Consumption Responsibility Weight under Renewable Portfolio Standards: An Integrated Evolutionary Game and Stochastic Optimization Approach," Energies, MDPI, vol. 16(7), pages 1-22, March.
    16. Pan, Yuling & Dong, Feng, 2023. "The impacts of energy finance policies and renewable energy subsidy on energy vulnerability under carbon peaking scenarios," Energy, Elsevier, vol. 273(C).
    17. Mellouli Dhoha & Wael Dammak & Hind Alnafisah & Ahmed Jeribi, 2024. "Dynamic spillovers between natural gas and BRICS stock markets during health and political crises," Eurasian Economic Review, Springer;Eurasia Business and Economics Society, vol. 14(2), pages 453-485, June.
    18. Han, Zhixin & Fang, Debin & Yang, Peiwen & Lei, Leyao, 2023. "Cooperative mechanisms for multi-energy complementarity in the electricity spot market," Energy Economics, Elsevier, vol. 127(PB).
    19. Ha Junsheng & Yuning Mu & Muhammad Mehedi Masud & Rulia Akhtar & Abu Naser Mohammad Saif & K. M. Anwarul Islam & Nusrat Hafiz, 2024. "Navigating the nexus: unraveling technological innovation, economic growth, trade openness, ICT, and CO2 emissions through symmetric and asymmetric analysis," Humanities and Social Sciences Communications, Palgrave Macmillan, vol. 11(1), pages 1-13, December.

    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. Haertel, Thomas & Hamburg, Britta & Kusin, Vladimir, 2022. "The macroeconometric model of the Bundesbank revisited," Technical Papers 01/2022, Deutsche Bundesbank.
    2. Santos, João & Domingos, Tiago & Sousa, Tânia & St. Aubyn, Miguel, 2016. "Does a small cost share reflect a negligible role for energy in economic production? Testing for aggregate production functions including capital, labor, and useful exergy through a cointegration-based method," MPRA Paper 70850, University Library of Munich, Germany.
    3. Trenczek, Jan & Wacker, Konstantin M., 2023. "Human Capital Misallocation and Output per Worker Differences: Beyond Cobb-Douglas," GLO Discussion Paper Series 1331, Global Labor Organization (GLO).
    4. Aaron B. Gertz & James B. Davies & Samantha L. Black, 2019. "A CGE Framework for Modeling the Economics of Flooding and Recovery in a Major Urban Area," Risk Analysis, John Wiley & Sons, vol. 39(6), pages 1314-1341, June.
    5. Elena Lagomarsino & Karen Turner, 2017. "Is the production function Translog or CES? An empirical illustration using UK data," Working Papers 1713, University of Strathclyde Business School, Department of Economics.
    6. Thomas de Graaff & Elisa Panzera & Henri L. F. de Groot, 2025. "Going the distance? A meta-analysis of the deterring effect of distance in tourism," Tinbergen Institute Discussion Papers 25-031/VIII, Tinbergen Institute.
    7. Lagomarsino, Elena, 2021. "Which nesting structure for the CES? A new selection approach based on input separability," Economic Modelling, Elsevier, vol. 102(C).
    8. Takuma Kunieda & Akihisa Shibata, 2024. "Insurance against Aggregate Shocks," ISER Discussion Paper 1239, Institute of Social and Economic Research, The University of Osaka.
    9. Florio, Erminia & Kharazi, Aicha, 2022. "Curtailment of Economic Activity and Labor Inequalities," GLO Discussion Paper Series 1166, Global Labor Organization (GLO).
    10. Lecca, Patrizio & Swales, Kim & Turner, Karen, 2011. "An investigation of issues relating to where energy should enter the production function," Economic Modelling, Elsevier, vol. 28(6), pages 2832-2841.
    11. Amaresh K Tiwari, 2023. "Automation In An Open, Catching-Up Economy: Aggregate And Microeconometric Evidence," University of Tartu - Faculty of Economics and Business Administration Working Paper Series 144, Faculty of Economics and Business Administration, University of Tartu (Estonia).
    12. Yazid Dissou & Lilia Karnizova & Qian Sun, 2015. "Industry-level Econometric Estimates of Energy-Capital-Labor Substitution with a Nested CES Production Function," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 43(1), pages 107-121, March.
    13. Turner, Karen, 2009. "Negative rebound and disinvestment effects in response to an improvement in energy efficiency in the UK economy," Energy Economics, Elsevier, vol. 31(5), pages 648-666, September.
    14. Schuster, Florian & Krahé, Max & Sigl-Glöckner, Philippa & Leusder, Dominik, 2021. "The cyclical component of the debt brake: Analysis and a reform proposal," Papers 277890, Dezernat Zukunft - Institute for Macrofinance, Berlin.
    15. Valeria Costantini & Francesco Crespi & Elena Paglialunga, 2019. "Capital–energy substitutability in manufacturing sectors: methodological and policy implications," Eurasian Business Review, Springer;Eurasia Business and Economics Society, vol. 9(2), pages 157-182, June.
    16. Schuster, Florian & Krahé, Max & Sigl-Glöckner, Philippa, 2021. "Wird die Konjunkturkomponente der Schuldenbremse in ihrer heutigen Ausgestaltung ihrer Aufgabe noch gerecht? Analyse und ein Reformvorschlag," Papers 277885, Dezernat Zukunft - Institute for Macrofinance, Berlin.
    17. Ken-ichi Hashimoto & Ryonghun Im & Takuma Kunieda & Akihisa Shibata, 2025. "Relative Risk Aversion and Business Fluctuations," ISER Discussion Paper 1272, Institute of Social and Economic Research, The University of Osaka.
    18. Max Krahé & Florian Schuster & Philippa Sigl-Glöckner, 2021. "Wird die Konjunkturkomponente der Schuldenbremse ihrer Aufgabe noch gerecht? [Is the Cyclical Component of the Debt Brake Still Up to Its Task?]," Wirtschaftsdienst, Springer;ZBW - Leibniz Information Centre for Economics, vol. 101(8), pages 621-628, August.
    19. Gechert, Sebastian & Heimberger, Philipp, 2022. "Do corporate tax cuts boost economic growth?," European Economic Review, Elsevier, vol. 147(C).
    20. Michal Antoszewski, 2017. "Panel estimation of sectoral substitution elasticities for CES production functions," EcoMod2017 10160, EcoMod.

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    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:eee:appene:v:331:y:2023:i:c:s0306261922016993. 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: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/405891/description#description .

    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.