Structural Change and Convergence of Energy Intensity Across OECD Countries, 1970-2005

Abstract This study tests the effects of productive capacities in socio-economic factors (human capital, transport, information-communication technology, institutions, private sector, and structural change) on energy efficiency in a sample of 125 countries. Energy efficiency is assessed by energy productivity (gross domestic product per unit of total primary energy supply) and energy intensity (total primary energy supply per capita). The world sample is divided into four income groups and an income-heterogeneous control group of non-renewable resource-dependent economies. The study utilizes cross-sectionally dependent and stationary panel data over the period 2000-2018. The analysis of variance shows that higher income groups monotonically have higher productive capacities and energy intensity. The regression results from appropriate fixed-effects and random-effects modeling reveal varied driver and barrier influences of the socio-economic factors on energy efficiency improvements (higher energy productivity and lower energy intensity). In some cases, predictors scale up both energy productivity and energy intensity indicating the issue of the rebound effect. Higher human capital capacity stimulates energy efficiency except for middle-income groups. Higher transport capacity reduces energy productivity, except for upper-middle-income economies, and tends to increase energy intensity for low-income and middle-income groups. The deployment of information-communication technologies is positively associated with energy productivity, except for low-income economies. Energy productivity performance of resource-dependent economies is improved by higher productive capacities in institutions and private sectors but impaired by structural change, whereas structural change drives energy efficiency in low-income economies. Additionally, the growth of gross national income per capita worsens energy efficiency for resource-dependent economies. Bidirectional feedback causalities are established between energy efficiency and its predictors in most cases. The heterogeneous findings are discussed for providing research and policy implications.

Download Full-text

Structural Change for a Post-Growth Economy: Investigating the Relationship between Embodied Energy Intensity and Labour Productivity

Sustainability ◽

10.3390/su12030962 ◽

2020 ◽

Vol 12 (3) ◽

pp. 962 ◽

Cited By ~ 1

Author(s):

Lukas Hardt ◽

John Barrett ◽

Peter G. Taylor ◽

Timothy J. Foxon

Keyword(s):

Structural Change ◽

Structural Changes ◽

Energy Intensity ◽

Labour Productivity ◽

Meaningful Work ◽

Embodied Energy ◽

Or Education ◽

Price Inflation ◽

Service Sectors ◽

The Uk

Post-growth economists propose structural changes towards labour-intensive services, such as care or education, to make our economy more sustainable by providing meaningful work and reducing the environmentally damaging production of material goods. Our study investigates the assumption underlying such proposals. Using a multi-regional input-output model we compare the embodied energy intensity and embodied labour productivity across economic sectors in the UK and Germany between 1995 and 2011. We identify five labour-intensive service sectors, which combine low embodied energy intensity with low growth in embodied labour productivity. However, despite their lower embodied energy intensities, our results indicate that large structural changes towards these sectors would only lead to small reductions in energy footprints. Our results also suggest that labour-intensive service sectors in the UK have been characterised by higher rates of price inflation than other sectors. This supports suggestions from the literature that labour-intensive services face challenges from increasing relative prices and costs. We do not find similar results for Germany, which is the result of low overall growth in embodied labour productivity and prices. This highlights that structural change is closely associated with economic growth, which raises the question of how structural changes can be achieved in a non-growing economy.

Download Full-text