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Why health matters in the energy efficiency-consumption nexus? Some answers from a life cycle analysis

Author

Listed:
  • Sondès Kahouli
  • Xavier Pautrel

    (GRANEM - Groupe de Recherche Angevin en Economie et Management - UA - Université d'Angers - Institut Agro Rennes Angers - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement)

Abstract

This paper shows that accounting for the growing interdisciplinary literature supporting the causality between energy efficiency and health and the empirical evidence reassessing the impor tance of health in workforce productivity, could explain a part of the paradoxal relationship found between energy efficiency and energy consumption. We build a 3-period overlapping generations model where we assume that residential energy inefficiency induces chronic disease for adults and bad health for elderly. We also assume that workers' health has an effect of their labor productivity. Our results suggest, in particular, that if mostly old (respectively young) people health is affected, the health impact of residential energy efficiency should have a backfire (resp. rebound) influence on residential energy consumption, by promoting precautionary saving (resp. by rising labor productivity). In policy terms, by showing that the link between energy efficiency and energy consumption is far from being just associated with technical conditions about preferences and/or production technology, our research emphasizes how crucial and complex are for governments the discussion and policy action dealing with the connection between energy conservation policies, health insurance system and growth.

Suggested Citation

  • Sondès Kahouli & Xavier Pautrel, 2022. "Why health matters in the energy efficiency-consumption nexus? Some answers from a life cycle analysis," Working Papers hal-03652352, HAL.
    • Handle: RePEc:hal:wpaper:hal-03652352
    Note: View the original document on HAL open archive server: https://univ-angers.hal.science/hal-03652352
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    More about this item

    Keywords

    Energy efficiency; Health; Precautionary saving; Labor productivity; Overlapping generations model. JEL classification D58; Q43;
    All these keywords.

    JEL classification:

    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

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