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Decoupling Economic Growth and Energy Use. An Empirical Cross-Country Analysis for 10 Manufacturing Sectors

Author

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  • Peter Mulder

    (International Institute for Applied Systems Analysis, Laxenburg, Austria)

  • Henri L.F. de Groot

    (Faculty of Economics and Business Administration, Vrije Universiteit Amsterdam)

Abstract

This paper provides an empirical analysis of decoupling economic growth and energy use and its various determinants by exploring trends in energy- and labour productivity across 10 manufacturing sectors and 14 OECD countries for the period 1970-1997. We explicitly aim to trace back aggregate developments in the manufacturing sector to developments at the level of individual subsectors. A cross-country decomposition analysis reveals that in some countries structural changes contributed considerably to aggregate manufacturing energy-productivity growth and, hence, to decoupling, while in other countries they partly offset energy-efficiency improvements. In contrast, structural changes only play a minor role in explaining aggregate manufacturing labour-productivity developments. Furthermore, we find labour-productivity growth to be higher on average than energy-productivity growth. Over time, this bias towards labour-productivity growth is increasing in the aggregate manufacturing sector, while it is decreasing in most manufacturing subsectors.

Suggested Citation

  • Peter Mulder & Henri L.F. de Groot, 2004. "Decoupling Economic Growth and Energy Use. An Empirical Cross-Country Analysis for 10 Manufacturing Sectors," Tinbergen Institute Discussion Papers 04-005/3, Tinbergen Institute.
    • Handle: RePEc:tin:wpaper:20040005
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    References listed on IDEAS

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    4. Idoko Ahmed Itodo & Shahrzad Safaeimanesh & Festus Victor Bekun, 2017. "Energy Use and Growth of Manufacturing Sector: Evidence from Turkey," Academic Journal of Economic Studies, Faculty of Finance, Banking and Accountancy Bucharest,"Dimitrie Cantemir" Christian University Bucharest, vol. 3(1), pages 88-96, March.

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    More about this item

    Keywords

    energy productivity; labour productivity; convergence; sectoral analysis;
    All these keywords.

    JEL classification:

    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • O47 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Empirical Studies of Economic Growth; Aggregate Productivity; Cross-Country Output Convergence
    • O5 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

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