Fiscal decentralization as new determinant of renewable energy demand in China: The role of income inequality and urbanization

Muhammad Shahbaz, Syed Kumail Abbas Rizvi, Kangyin Dong () and Xuan Vinh Vo

Renewable Energy, 2022, vol. 187, issue C, 68-80

Abstract: This paper examines the nexus between fiscal decentralization and renewable energy demand by including income inequality, economic growth, urbanization, and economic globalization as the main determinants in the energy demand function for the case of China. Quarterly frequency data for the period 1980–2018 are used for empirical analysis. Our empirical results show fiscal decentralization positively impacts the demand for renewable energy; in other words, fiscal decentralization can help increase renewable energy demand. In addition, income inequality is negatively linked to renewable energy consumption, while economic growth is positively associated with renewable energy demand. Urbanization and economic globalization add to renewable energy consumption. This study presents Chinese authorities with new guidelines for using fiscal decentralization as an economic tool to formulate effective energy policies for long-term development of the use of renewable energy sources.

Keywords: Fiscal decentralization; Renewable energy demand; Income inequality; Urbanization; China (search for similar items in EconPapers)
JEL-codes: C22 G10 Q21 R11 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (37)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:renene:v:187:y:2022:i:c:p:68-80

DOI: 10.1016/j.renene.2022.01.064

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