Mechanism of directed technological investment on energy productivity and energy structure: A unified theoretical framework

Xiaojun Sun, Yee Van Fan, Yalin Lei, Ting Pan and Petar Sabev Varbanov

Energy Economics, 2024, vol. 140, issue C

Abstract: The mechanisms and effects of technological investment on energy productivity and energy structure in the petrochemical industry remain unclear due to the directional nature of technological progress. This study proposes a unified theoretical framework for the impact of directed technological investment on energy productivity and energy structure by incorporating energy factors into the theory of technological progress bias. The aim is to elucidate the impact of technological progress on energy productivity and energy structure, and to unravel the underlying effect mechanisms. A fixed effects model that includes moderating effects is also developed to support the assessment. The study found that the petrochemical industry's technological investment in China was initially biased towards enhancing labour-augmenting technological progress. The mechanism analysis revealed that technological investment, under the moderating effects of price and environmental governance, preferred a capital-energy bias, leading to insignificant improvements in energy productivity but a substantial increase in labour productivity. In addition, the technological investment, influenced by the moderating effect of environmental governance, led to some improvement in the energy structure during the sample period. This study integrates the mechanisms of directed technological investment on energy productivity and energy structure into a unified analytical framework, systematically investigating the reasons, effect mechanisms, and consequences of bias, while providing empirical evidence that supports low-carbon development in the petrochemical industry.

Keywords: Directed technological investment; Factor-augmenting technological progress; Factor-biased technological progress; Energy productivity; Energy structure (search for similar items in EconPapers)
JEL-codes: O33 Q41 Q55 (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:140:y:2024:i:c:s0140988324006510

DOI: 10.1016/j.eneco.2024.107943

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