Household formation and residential energy demand: Evidence from Japan
We use a large household panel for Japan (Keio Household Panel Survey, KHPS), to estimate household-size economies in energy consumption. Household-size economies we obtain are significant and sizable: the per-capita energy-related spending of a two-adult household is only about two thirdsof a one-adult household's spending. We use the estimates ofhousehold-size economies to explore how the demographic trend towards smaller-sized household units changes the energy demand of the Japanese household sector. Between 2005 and 2010, for example, average household size in Japan decreased by about five percent. The resulting economy-wide loss in household-size economiesincreased the energy demandof the household sectorby about four percent.
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