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Structural evolution of energy embodied in final demand as economic growth: Empirical evidence from 25 countries

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  • Zhang, Yi
  • Fan, Ying
  • Xia, Yan

Abstract

Most countries of the world have put forward the goal of striving for carbon neutrality. The goal is hard to achieve by only relying on supply side solutions for the world. Most countries should pay more attention to the potential of energy conservation and emission reduction in the field of final demand. We construct an empirical analytic framework to investigate energy demand characteristics as economic growth from the perspective of final demand, and the results show a U-shaped curve relationship between the ratio of energy embodied in consumption to energy embodied in investment (REECEEI) and real gross domestic product per capita. The REECEEIs of major developing and developed countries are very different. Compare to the average baseline curve scenario, there is a notable conservation potential of energy embodied in final demand for major developing and developed countries. In climate negotiation, the demand for energy embodied in investment of developing countries should be guaranteed because it is the foundation of their economic development. To conserve energy and reduce emissions in the field of final demand, developing countries should focus on the field of energy embodied in investment, while developed countries should focus on the field of energy embodied in consumption.

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  • Zhang, Yi & Fan, Ying & Xia, Yan, 2021. "Structural evolution of energy embodied in final demand as economic growth: Empirical evidence from 25 countries," Energy Policy, Elsevier, vol. 156(C).
    • Handle: RePEc:eee:enepol:v:156:y:2021:i:c:s0301421521003438
    DOI: 10.1016/j.enpol.2021.112473
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    More about this item

    Keywords

    Energy; Economic growth; Climate change; Carbon neutrality;
    All these keywords.

    JEL classification:

    • B22 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Macroeconomics
    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • E11 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Marxian; Sraffian; Kaleckian
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

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