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Underlying energy demand trends in South Korean and Indonesian aggregate whole economy and residential sectors

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  • Sa'ad, Suleiman

Abstract

This paper used annual time series data over the period 1973-2008 to estimate energy demand functions for South Korea and Indonesian aggregated whole economy and Residential sectors. Furthermore, the underlying energy demand trend (UEDT), which may be non-linear and reflects not only technical progress, which usually produces greater energy efficiency, but also other factors such as changes in consumer tastes and the economic structure that may be working in the opposite direction, is also examined in the paper. In estimating the price and income elasticities, the study applies Harvey's structural time series approach where a stochastic trend is used as a proxy for UEDT. Empirical evidence from this study reveals that the estimated long-run income and price elasticities range from 0.58 to 1.15 and from -0.09 to -066, respectively. Furthermore the stochastic form for the UEDT is preferred for both countries and sectors, suggesting a wide variation in the exogenous effects of energy saving technical progress in addition to other pertinent exogenous factors such as economic structure, consumer preferences, and socio-economic influences.

Suggested Citation

  • Sa'ad, Suleiman, 2011. "Underlying energy demand trends in South Korean and Indonesian aggregate whole economy and residential sectors," Energy Policy, Elsevier, vol. 39(1), pages 40-46, January.
  • Handle: RePEc:eee:enepol:v:39:y:2011:i:1:p:40-46
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    References listed on IDEAS

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    1. Hunt, Lester C. & Judge, Guy & Ninomiya, Yasushi, 2003. "Underlying trends and seasonality in UK energy demand: a sectoral analysis," Energy Economics, Elsevier, vol. 25(1), pages 93-118, January.
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    8. Ibrahim, Ibrahim B. & Hurst, Christopher, 1990. "Estimating energy and oil demand functions : A study of thirteen developing countries," Energy Economics, Elsevier, vol. 12(2), pages 93-102, April.
    9. Lester C. Hunt & Guy Judge & Yashushi Ninomiya, 2000. "Modelling Technical Progress: An Application of the Stochastic Trend Model to UK Energy Demand," Surrey Energy Economics Centre (SEEC), School of Economics Discussion Papers (SEEDS) 99, Surrey Energy Economics Centre (SEEC), School of Economics, University of Surrey.
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    Cited by:

    1. Xavier Labandeira & Baltazar Manzano, 2012. "Some Economic Aspects of Energy Security," European Research Studies Journal, European Research Studies Journal, vol. 0(4), pages 47-64.
    2. repec:ers:journl:v:xv:y:2012:i:sie:p:47-64 is not listed on IDEAS
    3. Herrerias, M.J., 2013. "Seasonal anomalies in electricity intensity across Chinese regions," Applied Energy, Elsevier, vol. 112(C), pages 1548-1557.

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