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Multiplicative structural decomposition analysis of aggregate embodied energy and emission intensities

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  • Su, Bin
  • Ang, B.W.

Abstract

Aggregate intensity indicators, such as the ratio of a country's energy and emissions to its GDP, are often used by researchers and policymakers to study energy and environmental performance. This paper analyzes the relationship between energy (or emissions) and value added (or GDP) from a different viewpoint, namely from the demand rather than the production perspective, using the input–output (I–O) framework. The aggregate embodied intensity (AEI), defined as the ratio of embodied energy (or emissions) to embodied value added, can be defined at the aggregate, final demand category and sectoral levels. The total aggregate intensity can be presented as a weighted sum of the AEIs at the final demand category or sectoral level. Changes of the AEI at different levels can be decomposed to identify the driving forces using multiplicative SDA. A study using the latest 2007 and 2012 datasets of China indicates that (a) its aggregate intensity of CO2 emissions was mainly determined by the AEI in investment and (b) the emission intensity effect generally contributed the most to the AEI ratio changes at different levels. The proposed framework can be applied to other aggregate intensity indicators and extended to multi-country/region analysis.

Suggested Citation

  • Su, Bin & Ang, B.W., 2017. "Multiplicative structural decomposition analysis of aggregate embodied energy and emission intensities," Energy Economics, Elsevier, vol. 65(C), pages 137-147.
  • Handle: RePEc:eee:eneeco:v:65:y:2017:i:c:p:137-147
    DOI: 10.1016/j.eneco.2017.05.002
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    More about this item

    Keywords

    Aggregate embodied intensity; Input–output analysis; Structural decomposition analysis; Energy consumption; Carbon emissions; China;
    All these keywords.

    JEL classification:

    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models
    • P28 - Economic Systems - - Socialist Systems and Transition Economies - - - Natural Resources; Environment
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • R15 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Econometric and Input-Output Models; Other Methods

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