Determinants of China’s Energy Imports: An Empirical Analysis
Sustained economic growth in China has triggered a surge of energy imports, especially oil imports. This paper investigates the determinants of China’s energy import demand by using cointegraiton and VECM techniques. The findings suggest that, in the long run, growth of industrial production and expansion of transport sectors affect China’s oil imports, while domestic energy output has a substitution effect. Thus, as the Chinese economy industrializes and the automotive sector expands, China’s oil imports are likely to increase. Though China’s domestic oil production has a substitution effect on imports, its growth is limited due to scarce domestic reserve and high exploration costs. It is anticipated that China will be more dependent on overseas oil supply regardless of the world oil price.
|Date of creation:||2007|
|Date of revision:|
|Publication status:||forthcoming in Energy Policy|
|Contact details of provider:|| Postal: 35 Stirling Highway, Crawley, W.A. 6009|
Phone: (08) 9380 2918
Fax: (08) 9380 1016
Web page: http://www.business.uwa.edu.au/school/disciplines/economics
More information through EDIRC
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Lin Chan, Hing & Kam Lee, Shu, 1997. "Modelling and forecasting the demand for coal in China," Energy Economics, Elsevier, vol. 19(3), pages 271-287, July.
- Johansen, Soren & Juselius, Katarina, 1990. "Maximum Likelihood Estimation and Inference on Cointegration--With Applications to the Demand for Money," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 52(2), pages 169-210, May.
- Masih, Abul M. M. & Masih, Rumi, 1997. "On the temporal causal relationship between energy consumption, real income, and prices: Some new evidence from Asian-energy dependent NICs Based on a multivariate cointegration/vector error-correctio," Journal of Policy Modeling, Elsevier, vol. 19(4), pages 417-440, August.
- Hing Lin Chan & Shu Kam Lee, 1996. "Forecasting the Demand for Energy in China," The Energy Journal, International Association for Energy Economics, vol. 0(Number 1), pages 19-30.
- Johansen, Soren, 1992.
"Determination of Cointegration Rank in the Presence of a Linear Trend,"
Oxford Bulletin of Economics and Statistics,
Department of Economics, University of Oxford, vol. 54(3), pages 383-97, August.
- Johansen, S., 1991. "Determination of Cointegration Rank in the Presence of a Linear Trend," Papers 76a, Helsinki - Department of Economics.
- M. Hashem Pesaran & Yongcheol Shin & Richard J. Smith, 2001. "Bounds testing approaches to the analysis of level relationships," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 16(3), pages 289-326.
- Zhang, ZhongXiang, 2001.
"Why did the energy intensity fall in China's industrial sector in the 1990s? the relative importance of structural change and intensity change,"
13149, University Library of Munich, Germany.
- Zhang, ZhongXiang, 2003. "Why did the energy intensity fall in China's industrial sector in the 1990s? The relative importance of structural change and intensity change," Energy Economics, Elsevier, vol. 25(6), pages 625-638, November.
- Peter C. B. Phillips & Bruce E. Hansen, 1990. "Statistical Inference in Instrumental Variables Regression with I(1) Processes," Review of Economic Studies, Oxford University Press, vol. 57(1), pages 99-125.
- Narayan, Paresh Kumar & Narayan, Seema, 2005. "Estimating income and price elasticities of imports for Fiji in a cointegration framework," Economic Modelling, Elsevier, vol. 22(3), pages 423-438, May.
- Crompton, Paul & Wu, Yanrui, 2005.
"Energy consumption in China: past trends and future directions,"
Elsevier, vol. 27(1), pages 195-208, January.
- Paul Crompton & Yanrui Wu, 2004. "Energy Consumption in China: Past Trends and Future Directions," Economics Discussion / Working Papers 04-22, The University of Western Australia, Department of Economics.
- James H. Stock & Mark W. Watson, 1991.
"A simple estimator of cointegrating vectors in higher order integrated systems,"
Working Paper Series, Macroeconomic Issues
91-3, Federal Reserve Bank of Chicago.
- Stock, James H & Watson, Mark W, 1993. "A Simple Estimator of Cointegrating Vectors in Higher Order Integrated Systems," Econometrica, Econometric Society, vol. 61(4), pages 783-820, July.
- von Hirschhausen, Christian & Andres, Michael, 2000. "Long-term electricity demand in China -- From quantitative to qualitative growth?," Energy Policy, Elsevier, vol. 28(4), pages 231-241, April.
- Wu, Yanrui, 2003. "Deregulation and growth in China's energy sector: a review of recent development," Energy Policy, Elsevier, vol. 31(13), pages 1417-1425, October.
- Johansen, Soren, 1995. "Likelihood-Based Inference in Cointegrated Vector Autoregressive Models," OUP Catalogue, Oxford University Press, number 9780198774501, December.
- Skeer, Jeffrey & Wang, Yanjia, 2006. "Carbon charges and natural gas use in China," Energy Policy, Elsevier, vol. 34(15), pages 2251-2262, October.
- Dahl, Carol & Sterner, Thomas, 1991. "Analysing gasoline demand elasticities: a survey," Energy Economics, Elsevier, vol. 13(3), pages 203-210, July.
- Skeer, Jeffrey & Wang, Yanjia, 2007. "China on the move: Oil price explosion?," Energy Policy, Elsevier, vol. 35(1), pages 678-691, January.
- Zou, Gaolu & Chau, K.W., 2006. "Short- and long-run effects between oil consumption and economic growth in China," Energy Policy, Elsevier, vol. 34(18), pages 3644-3655, December.
- Granger, C. W. J. & Newbold, P., 1974. "Spurious regressions in econometrics," Journal of Econometrics, Elsevier, vol. 2(2), pages 111-120, July.
When requesting a correction, please mention this item's handle: RePEc:uwa:wpaper:07-03. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Verity Chia)
If references are entirely missing, you can add them using this form.