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Factors influencing energy intensity in four Chinese industries

Author

Listed:
  • Fisher-Vanden, Karen
  • Hu, Yong
  • Jefferson, Gary
  • Rock, Michael
  • Toman, Michael

Abstract

Energy intensity has declined significantly in four Chinese industries -- pulp and paper; cement; iron and steel; and aluminum. While previous studies have identified technological change within an industry to be an important influence on energy intensity, few have examined how industry-specific policies and market factors also affect industry-level intensity. This paper employs unique firm-level data from China's most energy-intensive large and medium-size industrial enterprises in each of these four industries over a six-year period from 1999 to 2004. It empirically examines how China's energy-saving programs, liberalization of domestic markets, openness to the world economy, and other policies, contribute to the decline in energy intensity in these industries. The results suggest that rising energy costs are a significant contributor to the decline in energy intensity in all four industries. China's industrial policies targeting scale economies -- for example,"grasping the large, letting go off the small"-- also seem to have contributed to reductions in energy intensity in these four industries. However, the results also suggest that trade openness and technology development led to declines in energy intensity in only one or two of these industries. Finally, the analysis finds that energy intensities vary among firms with different ownership types and regional locations.

Suggested Citation

  • Fisher-Vanden, Karen & Hu, Yong & Jefferson, Gary & Rock, Michael & Toman, Michael, 2013. "Factors influencing energy intensity in four Chinese industries," Policy Research Working Paper Series 6551, The World Bank.
  • Handle: RePEc:wbk:wbrwps:6551
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    References listed on IDEAS

    as
    1. Fan, Ying & Liao, Hua & Wei, Yi-Ming, 2007. "Can market oriented economic reforms contribute to energy efficiency improvement? Evidence from China," Energy Policy, Elsevier, vol. 35(4), pages 2287-2295, April.
    2. Ma, Chunbo & Stern, David I., 2008. "China's changing energy intensity trend: A decomposition analysis," Energy Economics, Elsevier, vol. 30(3), pages 1037-1053, May.
    3. Fisher-Vanden, Karen, 2009. "Energy in China: Understanding Past Trends and Future Directions," International Review of Environmental and Resource Economics, now publishers, vol. 3(3), pages 217-244, December.
    4. Zheng, Yingmei & Qi, Jianhong & Chen, Xiaoliang, 2011. "The effect of increasing exports on industrial energy intensity in China," Energy Policy, Elsevier, vol. 39(5), pages 2688-2698, May.
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    Cited by:

    1. Iris Claus & Les Oxley & Siqi Zheng & Cong Sun & Ye Qi & Matthew E. Kahn, 2014. "The Evolving Geography Of China'S Industrial Production: Implications For Pollution Dynamics And Urban Quality Of Life," Journal of Economic Surveys, Wiley Blackwell, vol. 28(4), pages 709-724, September.

    More about this item

    Keywords

    Energy Production and Transportation; Environment and Energy Efficiency; Energy and Environment; Water and Industry; E-Business;

    JEL classification:

    • F0 - International Economics - - General

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