IDEAS home Printed from https://ideas.repec.org/a/eee/eneeco/v145y2025ics014098832500266x.html

Energy intensity, supply chain digitization, technological progress bias in China's industrial sectors

Author

Listed:
  • Işık, Cem
  • Yan, Jiale
  • Ongan, Serdar

Abstract

Supply chain digitization through the development of digital technologies provides an opportunity to promote innovation and technological advancement in enterprises. This study first adopts the supply-side economics (Lucas, 1990) approach to measure the bias of Technological Progress (TP) in China's industrial sectors and analyzes the specific mechanisms. Based on the three-factor nested CES production function of energy, capital, and labor, this study further examines the energy intensity effect of TP bias due to supply chain digitization for 36 Chinese industrial sectors from 2008 to 2021. The findings are as follows. First, supply chain digitization-induced TP bias significantly mitigates the energy intensity of industrial sectors through the relative share of energy factors. Second, there are differences in the impact on energy intensity across sectors with different levels of competition and supply chain concentration. Third, supply chain digitization induced TP bias toward capital, which is the main reason for the decrease in the relative share of energy factors. Therefore, policymakers should consider sectoral characteristics and the effects of digitalization when designing their energy policies and technology investments. They should also stimulate economic growth by optimizing capital and energy use by developing digital technologies.

Suggested Citation

  • Işık, Cem & Yan, Jiale & Ongan, Serdar, 2025. "Energy intensity, supply chain digitization, technological progress bias in China's industrial sectors," Energy Economics, Elsevier, vol. 145(C).
    • Handle: RePEc:eee:eneeco:v:145:y:2025:i:c:s014098832500266x
    DOI: 10.1016/j.eneco.2025.108442
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S014098832500266X
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.eneco.2025.108442?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 look for a different version below or

    for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Zhang, Wei & Zhang, Ting & Li, Hangyu & Zhang, Han, 2022. "Dynamic spillover capacity of R&D and digital investments in China's manufacturing industry under long-term technological progress based on the industry chain perspective," Technology in Society, Elsevier, vol. 71(C).
    2. Cheng, Yuanyuan & Yao, Xin, 2021. "Carbon intensity reduction assessment of renewable energy technology innovation in China: A panel data model with cross-section dependence and slope heterogeneity," Renewable and Sustainable Energy Reviews, Elsevier, vol. 135(C).
    3. Yanling Chang & Eleftherios Iakovou & Weidong Shi, 2020. "Blockchain in global supply chains and cross border trade: a critical synthesis of the state-of-the-art, challenges and opportunities," International Journal of Production Research, Taylor & Francis Journals, vol. 58(7), pages 2082-2099, April.
    4. Jiyoung Kim & Satoshi Nakano & Kazuhiko Nishimura, 2021. "The role of ICT productivity in Korea-Japan multifactor CES productions and trades," Applied Economics, Taylor & Francis Journals, vol. 53(14), pages 1613-1627, March.
    5. Zhen, Wang & Xin-gang, Zhao & Ying, Zhou, 2021. "Biased technological progress and total factor productivity growth: From the perspective of China's renewable energy industry," Renewable and Sustainable Energy Reviews, Elsevier, vol. 146(C).
    6. Daron Acemoglu, 2002. "Technical Change, Inequality, and the Labor Market," Journal of Economic Literature, American Economic Association, vol. 40(1), pages 7-72, March.
    7. Gao, Zhiyuan & Zhao, Ying & Li, Lianqing & Hao, Yu, 2024. "Economic effects of sustainable energy technology progress under carbon reduction targets: An analysis based on a dynamic multi-regional CGE model," Applied Energy, Elsevier, vol. 363(C).
    8. Jia, Fu & Blome, Constantin & Sun, Hui & Yang, Yang & Zhi, Bangdong, 2020. "Towards an integrated conceptual framework of supply chain finance: An information processing perspective," International Journal of Production Economics, Elsevier, vol. 219(C), pages 18-30.
    9. Dani Rodrik, 2018. "New Technologies, Global Value Chains, and the Developing Economies," CESifo Working Paper Series 7307, CESifo.
    10. Yang, Zhenbing & Fan, Meiting & Shao, Shuai & Yang, Lili, 2017. "Does carbon intensity constraint policy improve industrial green production performance in China? A quasi-DID analysis," Energy Economics, Elsevier, vol. 68(C), pages 271-282.
    11. Lucas, Robert E, Jr, 1990. "Supply-Side Economics: An Analytical Review," Oxford Economic Papers, Oxford University Press, vol. 42(2), pages 293-316, April.
    12. Gopalan, Sasidaran & Reddy, Ketan & Sasidharan, Subash, 2022. "Does digitalization spur global value chain participation? Firm-level evidence from emerging markets," Information Economics and Policy, Elsevier, vol. 59(C).
    13. 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.
    14. Nick Clifton & Robyn Keast & David Pickernell & Martyn Senior, 2010. "Network Structure, Knowledge Governance, and Firm Performance: Evidence from Innovation Networks and SMEs in the UK," Growth and Change, Wiley Blackwell, vol. 41(3), pages 337-373, September.
    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. Xu, Hui & Wang, Xinpu & Zhang, Dawei, 2025. "Internet access and rural energy poverty alleviation in China: The moderating role of human capital," Energy, Elsevier, vol. 335(C).
    2. Cem Işık & Serdar Ongan & Bekhzod Kuziboev & İlyas Kays İmamoğlu, 2026. "Does Climate Change Vulnerability Cause Energy Vulnerability in Sustainable Development?," Sustainable Development, John Wiley & Sons, Ltd., vol. 34(S2), pages 1170-1181, March.
    3. Cem Işık & Serdar Ongan & Ebru Günlü & Rahman Aydın & İlyas Kays İmamoğlu, 2025. "The Role of Women's Entrepreneurship, Unemployment, Global Warming, and Technology in Sustainable Development: Evidence From OECD Countries," Sustainable Development, John Wiley & Sons, Ltd., vol. 33(S1), pages 1059-1077, November.
    4. Zhao, Zijian & Liu, Qiang & Qiu, Yunzhe, 2025. "Impact of supply chain digitalization on total factor productivity of agricultural enterprises," International Review of Financial Analysis, Elsevier, vol. 107(C).
    5. Feng, Langang & Hu, Jin & Wu, Kaiya & Irfan, Muhammad & Wei, Xiaorui, 2026. "Digitizing supply chains to boost renewable energy technological innovation," Renewable Energy, Elsevier, vol. 260(C).
    6. Chaaben, Nahla & Saida, Imen & Helali, Kamel, 2026. "Analyzing the non-linear impact of carbon dioxide emissions on renewable energy in Commonwealth nations," Renewable and Sustainable Energy Reviews, Elsevier, vol. 227(C).
    7. Su, Xiaomei & Zhao, Shangmei & Li, Wei & Fan, Wei, 2025. "Geopolitical risk, financial stress and renewable energy transition in China," International Review of Financial Analysis, Elsevier, vol. 107(C).
    8. Alnsour, Jamal, 2025. "Natural resource extraction, energy efficiency moderation, and sustainable development in the Gulf Cooperation Council countries," Resources Policy, Elsevier, vol. 110(C).
    9. Oktay Özkan & Ojonugwa Usman & Anthony Ladis Komba & George N Ike, 2025. "Spillover network of tourism stocks, metaverse, artificial intelligence, and traditional assets: Do oil-related and volatility shocks matter?," Tourism Economics, , vol. 31(7), pages 1471-1479, November.
    10. Yan, Haiming & Han, Di & Khursheed, Muhammad Aqib, 2025. "Does green finance improve energy security in Chinese Provinces? Evidence from machine learning approaches," Energy, Elsevier, vol. 335(C).

    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. Baltagi, Badi H. & Rich, Daniel P., 2005. "Skill-biased technical change in US manufacturing: a general index approach," Journal of Econometrics, Elsevier, vol. 126(2), pages 549-570, June.
    2. Ndubuisi, Gideon & Mensah, Emmanuel B. & Avenyo, Elvis K. & Sakyi, Daniel, 2025. "Global value chains and the innovativeness of firms in Africa," Technovation, Elsevier, vol. 146(C).
    3. Paul, Saumik, 2019. "Labor Income Share Dynamics with Variable Elasticity of Substitution," IZA Discussion Papers 12418, IZA Network @ LISER.
    4. Lee, Chien-Chiang & Yuan, Zihao & Lee, Chi-Chuan & Chang, Yu-Fang, 2022. "The impact of renewable energy technology innovation on energy poverty: Does climate risk matter?," Energy Economics, Elsevier, vol. 116(C).
    5. Vlachos, Jonas & Svaleryd, Helena, 2005. "Factor Supplies and the Direction of Technological Change," CEPR Discussion Papers 5086, Centre for Economic Policy Research.
    6. Zhang, Yulai & Hainan, Liu & Feng, Fangfang & Wu, Xuezhou, 2025. "Digital economy, education, human capital and urban–rural income disparity," Finance Research Letters, Elsevier, vol. 71(C).
    7. Gniniguè, Moukpè & Wonyra, Kwami Ossadzifo & Tchagnao, Abdou-Fataou & Bayale, Nimonka, 2023. "Participation of developing countries in global value chains: What role for information and communication technologies?," Telecommunications Policy, Elsevier, vol. 47(3).
    8. Wang, Lianghu & Wang, Zhao & Ma, Yatian, 2022. "Does environmental regulation promote the high-quality development of manufacturing? A quasi-natural experiment based on China's carbon emission trading pilot scheme," Socio-Economic Planning Sciences, Elsevier, vol. 81(C).
    9. Jin, Hui & Jorgenson, Dale W., 2010. "Econometric modeling of technical change," Journal of Econometrics, Elsevier, vol. 157(2), pages 205-219, August.
    10. Liu, Xiaoqian & Jia, You & Zhu, Conghao & Wang, Chang’an & Yao, Jian, 2025. "Policy-driven innovation: Does the renewable energy development initiative foster corporate innovation in renewable energy technologies?," International Review of Financial Analysis, Elsevier, vol. 102(C).
    11. Dupuy, A., 2003. "Will the source of demand shifts please stand up? Steady demand or Acceleration," ROA Research Memorandum 4E, Maastricht University, Research Centre for Education and the Labour Market (ROA).
    12. Antonietti, Roberto & Burlina, Chiara & Rodriguez-Pose, Andres, 2025. "Digital technology and regional income inequality: are better institutions the solution?," LSE Research Online Documents on Economics 127062, London School of Economics and Political Science, LSE Library.
    13. Xu, Bin & Lin, Boqiang, 2023. "Assessing the green energy development in China and its carbon reduction effect: Using a quantile approach," Energy Economics, Elsevier, vol. 126(C).
    14. Jorgenson, Dale W. & Jin, Hui & Slesnick, Daniel T. & Wilcoxen, Peter J., 2013. "An Econometric Approach to General Equilibrium Modeling," Handbook of Computable General Equilibrium Modeling, in: Peter B. Dixon & Dale Jorgenson (ed.), Handbook of Computable General Equilibrium Modeling, edition 1, volume 1, chapter 0, pages 1133-1212, Elsevier.
    15. Daniel Ştefan Armeanu & Georgeta Vintilă & Ştefan Cristian Gherghina, 2017. "Empirical Study towards the Drivers of Sustainable Economic Growth in EU-28 Countries," Sustainability, MDPI, vol. 10(1), pages 1-22, December.
    16. Vincenzo Varriale & Antonello Cammarano & Francesca Michelino & Mauro Caputo, 2021. "Sustainable Supply Chains with Blockchain, IoT and RFID: A Simulation on Order Management," Sustainability, MDPI, vol. 13(11), pages 1-23, June.
    17. Persson, Torsten & Tabellini, Guido, 2002. "Political economics and public finance," Handbook of Public Economics, in: A. J. Auerbach & M. Feldstein (ed.), Handbook of Public Economics, edition 1, volume 3, chapter 24, pages 1549-1659, Elsevier.
    18. Miroslav N. Jovanović, 2019. "The Supply Chain Economy: How Far does it Spread in Space and Time?," Economia Internazionale / International Economics, Camera di Commercio Industria Artigianato Agricoltura di Genova, vol. 72(4), pages 393-452.
    19. Checchi, Daniele & Visser, Jelle & van de Werfhorst, Herman G., 2007. "Inequality and Union Membership: The Impact of Relative Earnings Position and Inequality Attitudes," IZA Discussion Papers 2691, IZA Network @ LISER.
    20. Vasilev, Aleksandar, 2015. "Welfare gains from the adoption of proportional taxation in a general-equilibrium model with a grey economy: the case of Bulgaria's 2008 flat tax reform," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 48(2), pages 169-185.

    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:eneeco:v:145:y:2025:i:c:s014098832500266x. 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/locate/eneco .

    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.