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Energy Journal Issue

The Energy Journal
Volume 5, Number 4

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Energy Demand in Jordan: A Case Study of Energy-Economy Linkages

Charles R. Blitzer

DOI: 10.5547/ISSN0195-6574-EJ-Vol5-No4-1View Abstract

Higher world oil prices in the past decade have caused serious economic disruptions in most developing countries, which as a group are highly dependent on imported oil in relation to both the sizes of their economies and their total imports. I Increased oil bills have frequently led to lower aggregate growth rates, more severe balance-of-payments and debt problems, disruptions in energy-using sectors, and domestic inflation. Whether or not world oil prices resume their upward spiral, the oil-importing developing countries will continue to face serious macro-economic adjustment problems related in one way or another to energy.

Canadian Natural Gas Exports to the United States: A Monopolistic Intertemporal Analysis

Terrence E. Daniel, Henry M. Goldberg, and John P. Weyant

DOI: 10.5547/ISSN0195-6574-EJ-Vol5-No4-2View Abstract

The appropriate level and pricing of energy exports to the United States have been actively debated aspects of Canadian public policy for many years. In particular, natural gas export levels and prices have been subject to the ebb and flow of public opinion over the past two decades as Canada has gone through cycles of apparent excess and short supply. Canada perennially faces the difficult task of trading off the large potential revenues that can be derived from using its natural gas resources for current gas exports against the value of conserving them for future domestic use. Such an evaluation depends critically on factors that are uncertain and preferences that are intertemporal. It must also take into account that domestic prices in Canada are not determined in a competitive market.

A Comparison of Multivariate Logit and Translog Models for Energy and Nonenergy Input Cost Share Analysis

Thomas J. Lutton and Michael R. LeBlanc

DOI: 10.5547/ISSN0195-6574-EJ-Vol5-No4-3View Abstract

With the advent of the translogarithmic (translog) cost function has come greater interest in estimating systems of input share equations (Christensen and Greene, 1976; Berndt and Wood, 1975). A distinguishing feature of the translog cost function is that optimal input shares are linear in parameters. The linearity arises from the second-order approximation and facilitates estimation of the share system. Linearity, however may result in negative fitted shares if error terms are assumed to be additive and normally distributed. Woodland (1979) demonstrated that maximum likelihood estimators with an underlying Dirichlet distribution constrain fitted shares to be inside the zero-one interval for the sample. However, it is possible to obtain shares outside the zero-one interval when the model is used for forecasting. Moreover, there is no theoretical reason why input shares should be monotonic in input prices. If a third-order Taylor series expansion is assumed, the monotonicity restriction can be relaxed, but such an assumption sacrifices the principle of parametric parsimony (Fuss et al., 1978).

Nigeria's Internal Petroleum Problems: Perspectives and Choices

Akin Iwayemi

DOI: 10.5547/ISSN0195-6574-EJ-Vol5-No4-4View Abstract

As a major oil producer and member of OPEC, Nigeria benefited greatly from the sharp increases in world oil prices during the 1970s. It was especially hard hit by the weakening of oil markets during the past four years, when its oil production had to be cut back sharply and its prices reduced. The impact of these developments, including the replacement of the civilian government by a military regime in December 1983, has been discussed elsewhere. I Less well known abroad is the fact that during this entire period, Nigeria suffered sporadic but severe internal energy supply problems, including shortages of petroleum products and irregular availability of electricity. If past policies are continued, Nigeria's energy problems are likely to become severe enough to jeopardize its position as an oil exporter.

A Note on Rowen and Weyant,"Reducing the Economic Impacts of Oil Supply Interruptions: An International Perspective"

Harry D. Saunders

DOI: 10.5547/ISSN0195-6574-EJ-Vol5-No4-5View Abstract

Henry Rowen and John Weyant (1982) commit the classic error of trying to answer an important policy question with tools that do not fit the job. Nor does their care in attaching explicit caveats to their conclusions overcome the fact that the limitations of their approach are serious.The question of oil supply disruptions and their potential economic impact is indeed important, and it remains so despite slack oil markets. Policymakers may yet be faced with situations that require them to decide quickly on the advisability of emergency tariffs and other such measures; and they will need reasonable assurances that the caveats analysts attach to policy recommendations do not overwhelm the recommendations themselves. Just such a danger is inherent in the inappropriate application of models and the application of inappropriate models.

Rate-of-Return Attrition and Inflation-Induced Penalties in Public Utility Common Stocks

Wallace N. Davidson, III and John L. Glascock

DOI: 10.5547/ISSN0195-6574-EJ-Vol5-No4-6View Abstract

While the rate of inflation seems to be easing, the interest in its impact on corporate security prices (Feldstein, 1980) and on corporate investment policy (Caks, 1981; Higgins, 1977) has continued. Unlike nonregulated firms, utilities face the added difficulties of regulation-induced inflation penalties and return on equity (ROE) attrition.

Interpreting the International Energy Workshop Survey Results - Uncertainty and the Need for Consistent Modeling

Gary W. Yohe

DOI: 10.5547/ISSN0195-6574-EJ-Vol5-No4-7View Abstract

Manne and Schrattenholzer's (1984) summary report of the poll responses of the 1983 International Energy Workshop (IEW) published in this Journal certainly captures the flavor of the Laxenburg meetings. Opinion about the future trends in energy consumption, prices, gross domestic product, and so on, at world, regional, and national levels was widely divergent even for the near term. In fact, it was noted with some amusement (and some dismay) that it seemed impossible to agree about what had already happened in 1980. Manne and Schrattenholzer accurately advertise the spreads they report as just what they are- differences of opinion. Nevertheless, even the statistically trained reader may be tempted to interpret these spreads as reflections of the uncertainty with which we view the world's energy future. One point of this Note is to provide independent emphasis that this uncertainty interpretation is, unless we are extremely lucky, entirely inappropriate. The second purpose is to register several other concerns about the lack of economic consistency in much of the modeling with which respondents to the JEW prepared their reports. Inconsistency, it will be argued, can undermine not only the usefulness of surveys like the one conducted by the IEW, but also the ability of any appropriate procedure to investigate the subjective uncertainty that blurs our best vision into the future.

A Note on Optimal System Planning

Ferdinand E. Banks

DOI: 10.5547/ISSN0195-6574-EJ-Vol5-No4-8View Abstract

There are two relatively harmless slips in the interesting and important paper on optimal system planning by Michael Einhorn (1983). Both are associated with the intermediate plant.

Book Review - Oil Economists' Handbook 1984

Jack D. Kirwan

DOI: 10.5547/ISSN0195-6574-EJ-Vol5-No4-9View Abstract

There are two relatively harmless slips in the interesting and important paper on optimal system planning by Michael Einhorn (1983). Both are associated with the intermediate plant.

Letters to the Editor

DOI: 10.5547/ISSN0195-6574-EJ-Vol5-No4-10View Abstract

There are two relatively harmless slips in the interesting and important paper on optimal system planning by Michael Einhorn (1983). Both are associated with the intermediate plant.


DOI: 10.5547/ISSN0195-6574-EJ-Vol5-No4-11View Abstract

There are two relatively harmless slips in the interesting and important paper on optimal system planning by Michael Einhorn (1983). Both are associated with the intermediate plant.