Electrification and productivity growth in Korean manufacturing plants

Yonghun Jung and Seong-Hoon Lee

Energy Economics, 2014, vol. 45, issue C, 333-339

Abstract: This paper presents a theoretical model of firm-specific productivity growth that incorporates technological knowledge by electrification and tests the model empirically. Our theoretical explanations suggest that the energy-transformation from fossil fuel to electricity by electrification could cause a decrease in the short-term level of productivity but an increase in the long-term rate of productivity growth in firms. Our empirical evidence from a large panel of Korean manufacturing plants is generally consistent with the theoretical predictions on the relatedness of technological knowledge by the electrification to the level and rate effects of the firm's productivity. The electrification measured by the share of electricity results in lowering the short-term productivity level but in raising the long-term rate of productivity growth of firms.

Keywords: Electrification; Economic growth; Korean manufacturing plants (search for similar items in EconPapers)
JEL-codes: O1 Q4 (search for similar items in EconPapers)
Date: 2014
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:45:y:2014:i:c:p:333-339

DOI: 10.1016/j.eneco.2014.07.022

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