Heterogenous Energy Consumption Behavior by Firm Size: Evidence from Korean Environmental Regulations

Jaeseok Lee and Jongmin Yu
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Jaeseok Lee: Energy Institute, Seoul Energy Corporation, 20 Mokdongseo-ro, Yangcheon-gu, Seoul 07978, Korea
Jongmin Yu: Department of Economics, Hongik University, 94 Wausan-ro, Mapogu, Seoul 121-791, Korea

Sustainability, 2019, vol. 11, issue 11, 1-15

Abstract: We analyze the interdependencies between energy usage, energy costs, renewable energy shares, economic growth, and greenhouse gas (GHG) emissions in the Korean industrial sector by employing a time-series panel vector model. Although the topic itself about has been classic one, our research to investigate diverse dynamics between large and small-mid size businesses using micro-firm level data is the first study in literature. Since firms with different sizes are put in different policy circumstances, the aggregate-level data analysis could possibly disregard the effectiveness of environmental & renewable policies and underestimate the policy sensitivity of firms. Our findings demonstrate that the increase in energy consumption in larger firms has a greater impact on their energy costs and GHG emissions than for small and medium-sized enterprises (SMEs). Moreover, it has a significant effect on GDP. Also, the increase in renewable energy shares only has a significant influence on the energy consumption and GHG emission levels of large firms.

Keywords: panel vector autoregression (VAR); energy; industrial sector; GHG emissions; large firms; SMEs (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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