Persistence and stationarity of sectoral energy consumption in the US: A confidence interval approach

Firouz Fallahi

Energy & Environment, 2019, vol. 30, issue 5, 882-897

Abstract: Energy consumption is the primary source of greenhouse gases and carbon emissions, so reduction of energy consumption in any sector of the economy can be used as a tool to fight against global warming. However, to do that satisfactorily, it is necessary to know the degree of persistence of sectoral energy consumption. In fact, the degree of persistence shows how much of impact of shocks carries over to the following periods. Therefore, in this paper, we analyze the persistence and stationarity of sectoral energy consumption in the United States during 1952–2016 using bootstrap and subsampling confidence intervals. These confidence intervals provide more information compared to the unit root tests. Not only they provide evidence about the stationarity or non-stationarity of the variables, but also they show the degree of persistence. In addition, they require fewer assumptions on the nature of data. The findings show that the energy consumption in the residential and commercial sectors appears to be stationary but persistent. On the contrary, the energy consumption in the industrial and transportation sectors is non-stationary. Therefore, the industrial and transportation sectors are the best candidates to implement energy conservation and economic or environmental-oriented policies, because the effect of these policies will be permanent. Similar policies can be applied in the residential and commercial sectors as well; however, the effects of shocks to these sectors will diminish eventually.

Keywords: Energy consumption; confidence interval; stationary; persistence; bootstrap; subsampling (search for similar items in EconPapers)
Date: 2019
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://journals.sagepub.com/doi/10.1177/0958305X18813688 (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:sae:engenv:v:30:y:2019:i:5:p:882-897

DOI: 10.1177/0958305X18813688

Access Statistics for this article

More articles in Energy & Environment
Bibliographic data for series maintained by SAGE Publications ().