An evaluation of technical progress and energy rebound effects in China's iron & steel industry

Xiaolei Wang, Xiaohui Wen and Chunping Xie

Energy Policy, 2018, vol. 123, issue C, 259-265

Abstract: As a pillar industry in China, the iron & steel sector have under through rapid growth and technical progress for decades. However, energy polices aiming at energy savings may not be as good as expected due to the existence of rebound effects. The motivation of the paper is to analysis the nexus between technical progress and energy rebound effects. Based on a three-input trans-log cost function model, we first estimate the share equation and the corresponding price elasticity for each input factor. Then, the rebound effect in China's iron & steel industry over 1985–2015 is evaluated through decomposing the energy prices. Empirical results show that: (1) The price elasticities of input factors are negative; (2) Energy/capital and energy/labor show substitute relationships; (3) The average energy rebound effect in the ISI is as high as 73.88%; (4) The energy rebound effect shows a downward trend before the 11th Five-year period and then an upward trend after that. Therefore, policies proposals of lowering the rebound effect should be placed not only on technical progress, but also on energy price reform by reducing energy subsidies and thus accelerating energy price marketization, so as to promote energy substitution, reduce energy rebound effect and produce further economic and environmental benefits.

Keywords: Technical progress, Price elasticity, Energy rebound effect; China's iron & steel industry (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (17)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0301421518305081
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:enepol:v:123:y:2018:i:c:p:259-265

DOI: 10.1016/j.enpol.2018.08.016

Access Statistics for this article

Energy Policy is currently edited by N. France

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