Accounting for Nonlinearity, Asymmetry, Heterogeneity, and Cross-Sectional Dependence in Energy Modeling: US State-Level Panel Analysis

Brantley Liddle

Economies, 2017, vol. 5, issue 3, 1-11

Abstract: This paper provides an example of several modeling and econometric advances used in the panel estimation of energy demand elasticities. The paper models the demand of total, industrial, and transport energy consumption and residential and commercial electricity consumption by analyzing US state-based panel data. The paper employs recently developed dynamic panel methods that address heterogeneity, nonstationarity, and cross-sectional dependence. In addition, the paper (i) considers possible nonlinear relationships between energy consumption and income without employing polynomial transformations of integrated income; and (ii) allows for and calculates possible asymmetric relationships between energy consumption and price. Finally, the paper models energy efficiency improvements by a nonlinear time trend. To our knowledge no other paper has combined all of the econometric and modeling advances that are applied here. Most of the results conformed to expectations; however, limited to no evidence of nonlinearities and asymmetries were uncovered.

Keywords: disaggregated energy demand; dynamic common factor panel models; nonstationary; heterogeneous panels; nonlinear; asymmetric relationships; US states (search for similar items in EconPapers)
JEL-codes: E F I J O Q (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
https://www.mdpi.com/2227-7099/5/3/30/pdf (application/pdf)
https://www.mdpi.com/2227-7099/5/3/30/ (text/html)

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:gam:jecomi:v:5:y:2017:i:3:p:30-:d:108265

Access Statistics for this article

Economies is currently edited by Ms. Adore Zhou

More articles in Economies from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().