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Energy Abundance, Trade and Specialization

Abstract:
Do countries with large energy endowments have larger energy-intensive sectors? We answer this question empirically using a panel with 14 high-income countries from Europe, America and Asia and 10 broad sectors, from 1970 to 1997. Energy-abundant countries have 7 to 10 percent higher employment and 13 to 17 percent higher net exports per value added in energy-intensive sectors vis-a`-vis otherwise comparable countries. Conversely, energy-scarce countries specialize in non-energy-intensive sectors.

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Keywords: Trade, Energy, Factor abundance

DOI: 10.5547/01956574.36.3.rger

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Published in Volume 36, Number 3 of The Quarterly Journal of the IAEE's Energy Economics Education Foundation.