The effects of Mandatory Energy Efficiency Policy on resource allocation efficiency: Evidence from Chinese industrial sector

Mian Yang, Yili Hong and Fuxia Yang

Economic Analysis and Policy, 2022, vol. 73, issue C, 513-524

Abstract: The extensive theoretical literature emphasizes that the improvement of resource allocation efficiency plays a critical role in the economic efficiency effect of energy and environmental policies. However, few empirical studies focus on the assessment of this effect of energy policies on resource allocation efficiency. Thus, this article treats the implementation of China’s Mandatory Energy Efficiency Policy (MEEP) during the 11th Five-Year Plan, as a quasi-natural experiment to testify the impact of MEEP on resource allocation efficiency of industries. To this end, an annual data panel including a total of 2,382,263 observations from 625,478 micro enterprises at the city sub-sector level is constructed for 280 cities from 1998 to 2008. The Difference-in-Difference (DID) model and the DDD model are adopted to estimate the effect of MEEP on the resource allocation efficiency of industries in China and its heterogeneity across sub-industries, respectively. The results show that China’s MEEP enforced during the 11th Five-Year Plan indeed contributes significantly to the efficiency improvement of resource allocation in the industrial sector. The conclusion is still robust by replacing the different indicators or changing time intervals. Further, this effect for the high-energy-consuming or high-polluting industries is significantly lower than that in others. It may be attributed to the differences in the response rates to MEEP caused by the ownerships among firms and industries.

Keywords: Resource allocation efficiency; Mandatory Energy Efficiency Policy; DID model; DDD model; Industrial sector (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0313592621001624
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:ecanpo:v:73:y:2022:i:c:p:513-524

DOI: 10.1016/j.eap.2021.11.012

Access Statistics for this article

Economic Analysis and Policy is currently edited by Clevo Wilson

More articles in Economic Analysis and Policy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().