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Energy reform and energy consumption convergence in Mexico: A spatial approach

Francisco A. Castellanos-Sosa, René Cabral and André Varella Mollick

Structural Change and Economic Dynamics, 2022, vol. 61, issue C, 336-350

Abstract: This paper examines the convergence of energy consumption per capita (ECPC) in the 32 Mexican states from 2002 to 2017. Regardless of the recent Global Financial Crisis and Mexican Energy Reform, we first find evidence of a positive, increasing, and statistically significant spatial correlation of ECPC across states. Using cross-section and spatial dynamic econometric models, we document absolute and conditional β-convergence in ECPC during the pre-crisis, pre-Energy Reform, post-Energy Reform, and the whole study period. We report stable and larger convergence rates in spatial dynamic models, close to 20%, versus 3% without spatial effects. These figures suggest between-states relationships are crucial in Mexico. We also find an inverted U-shape relationship between ECPC and GDP per capita.

Keywords: Convergence; Energy use; Mexico; Panel data; Spatial econometric model (search for similar items in EconPapers)
JEL-codes: C23 O47 O54 P18 P28 Q43 (search for similar items in EconPapers)
Date: 2022
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Persistent link: https://EconPapers.repec.org/RePEc:eee:streco:v:61:y:2022:i:c:p:336-350

DOI: 10.1016/j.strueco.2022.03.007

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