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Determinants of energy productivity in 39 countries: An empirical investigation

Tarek Atalla and Patrick Bean

Energy Economics, 2017, vol. 62, issue C, 217-229

Abstract: This paper uses three types of analysis to investigate the drivers of energy productivity changes occurring in 39 countries during 1995–2009. We find that increases in sectoral energy productivity were the primary driver behind economy-wide energy productivity improvements. Structural economic shifts away from industry and towards service-oriented sectors played a lesser role in aggregate energy productivity improvements. Nations with similar demographic and economic characteristics showed similar levels of energy productivity and rates of improvement. Most notably, former communist countries and nations undergoing economic liberalization exhibited the highest rate of improvement—although they are still less energy productive than developed nations. Moreover, the econometric analysis reinforces the long-standing hypothesis that higher levels of income per capita and higher energy prices are associated with greater energy productivity, while a greater share of output from industry is associated with lower energy productivity levels. In particular, higher energy prices and income levels are associated with improvements in sectoral energy productivity.

Keywords: Economic growth; Energy productivity; Decomposition analysis; WIOD; Cluster analysis; Co-integration (search for similar items in EconPapers)
JEL-codes: C22 C43 C51 Q41 Q43 (search for similar items in EconPapers)
Date: 2017
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Energy Economics is currently edited by R. S. J. Tol, Beng Ang, Lance Bachmeier, Perry Sadorsky, Ugur Soytas and J. P. Weyant

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