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Separating the Changing Composition of U.S. Manufacturing Production from Energy Efficiency Improvements: A Divisia Index Approach

G. Boyd, J. F. McDonald, M. Ross, and D. A. Hansont

Year: 1987
Volume: Volume 8
Number: Number 2
DOI: 10.5547/ISSN0195-6574-EJ-Vol8-No2-6
View Abstract

Abstract:
The demand for energy is normally broken down into five sectors: industry, utilities, the residential sector, the commercial sector, and transportation. Industry is the most heterogeneous of these with manufacturing accounting for about 80 percent of total industrial energy demand. Manufacturing is itself a very heterogeneous collection of production activities. As defined by the Standard Industrial Classification (SIC) method of the U.S. Department of Commerce, there were 448 manufacturing sectors in 1972.



A Structural Decomposition Analysis of Changes in Energy Demand in Taiwan: 1971-1984

Chia-Yon Chen and Adam Rose

Year: 1990
Volume: Volume 11
Number: Number 1
DOI: 10.5547/ISSN0195-6574-EJ-Vol11-No1-11
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Abstract:
Taiwan represents an interesting case study of a nation that has been able to adapt to the energy crisis remarkably well, registering sustained economic growth despite increased oil import expenditures. Certain characteristics of Taiwan's economy set it apart from a number of other developing countries. First, Taiwan's economy is very closely inter-linked with international markets. It is a major exporter of goods, and it has had to rely heavily on imports of energy since its indigenous energy resources are so meager. Second, the nation has had an unusually high rate of growth over the past 30 years. For example, Taiwan's GNP grew at an average rate of 9.1 percent per year during the period 1952-1980, as opposed to growth rates of generally below 5 percent experienced by many other LDCs during that period.



Energy and Economic Interaction in Thailand

John C Sheerin

Year: 1992
Volume: Volume 13
Number: Number 1
DOI: 10.5547/ISSN0195-6574-EJ-Vol13-No1-8
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Abstract:
The rapid rate of economic growth experienced in Thailand through the mid-1980s has been associated with an even more rapid use of energy as a factor input. This paper decomposes total change in energy into output, structural change and conservations effects. In the industrial sector, the rate of expansion in total energy inputs has been sharply reduced due to a structural change away from agricultural and manufacturing dominance and by a significant increase in the efficiency of energy use. In the household sector, the energy impacts of the expansion in the use of appliances were more than offset by the economies associated with delivered energy forms, and by other apparent adjustments in connection with higher energy costs.



The Application of the Divisia Index to the Decomposition of Changes in Industrial Energy Consumption

X. Q. Liu, B. W. Ang and H.L. Ong

Year: 1992
Volume: Volume 13
Number: Number 4
DOI: 10.5547/ISSN0195-6574-EJ-Vol13-No4-9
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Abstract:
We review a number of methods that have recently been proposed to decompose changes in industrial energy consumption. We then propose two parametric methods based on the Divisia index, where the integral path problem in the Divisia index is transformed into a parameter estimation problem. It is shown that there can be an infinite number of sets of decomposition results, each corresponding to a particular combination of parameter values, and that several recently proposed methods are in fact special cases of these two methods. We then introduce an approach to estimate the parameter values uniquely. Referred to as the Adaptive Weighting Divisia Method, this method is supported by vigorous mathematical analysis and does not involve arbitrary guesses of parameter valuesas is the case for the existing methods. We also discuss the application and the associated statistical problems of the various decomposition methods, and present the results of a study using the data for Singapore industry.



The Imperfect Price-Reversibility of World Oil Demand

Dermot Gately

Year: 1993
Volume: Volume14
Number: Number 4
DOI: 10.5547/ISSN0195-6574-EJ-Vol14-No4-11
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Abstract:
This paper examines the price-reversibility of world oil demand, using price decomposition methods employed previously on other energy demand data. We conclude that the reductions in world oil demand following the oil price increases of the 1970s will not be completely reversed by the price cuts of the 1980s. The response to price cuts in the 1980s is perhaps only one-fifth that for price increases in the 1970s. This has dramatic implications for projections of oil demand, especially under low-price assumptions. We also consider the effect on demand of a price recovery (sub-maximum increase) in the 1990s-due either to OPEC or to a carbon tax-specifically whether the effects would be as large as for the price increases of the 1970s or only as large as the smaller demand reversals of the 1980s. On this the results are uncertain, but a tentative conclusion is that the response to a price recovery would lie midway between the small response to price cuts and the larger response to increases in the maximum historical price. Finally, We demonstrate two implications of wrongly assuming that demand is perfectly price-reversible. First, such an assumption will grossly overestimate the demand response to price declines of the 1980s. Secondly, and somewhat surprisingly, it causes an underestimate of the effect of income growth on future demand.



Structural Changes and Energy Consumption in the Japanese Economy 1975-95: An Input-Output Analysis

Xiaoli Han and TK. Lakshmanan

Year: 1994
Volume: Volume15
Number: Number 3
DOI: 10.5547/ISSN0195-6574-EJ-Vol15-No3-9
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Abstract:
This paper analyzes the effects of the pervasive structural changes in the Japanese economy on its energy intensity in the decade 1975-85. It advances the energy input-output (I-O) structural decomposition analysis (SDA) in two ways. First, it introduces a double denominator method to relax the assumption that all electricity is derived from fossil fuels in energy I-O analysis. Second, it develops a model which identifies explicitly the effect of energy imports. The application of our model to the Japanese experience suggested that changes in final demand structure contributed more to reducing the energy intensity of the economy than the much discussed effects of changes in technology. The overall decline in the energy intensity of the economy was accompanied by drastic shifts in the fuel mix of its energy supply, in particular, a substitution of oil by natural gas.



Decomposition of SO2, NO1 and CO2 Emissions from Energy Use of Major Economic Sectors in Taiwan

Sue J. Lin and Tzu C. Chang

Year: 1996
Volume: Volume17
Number: Number 1
DOI: 10.5547/ISSN0195-6574-EJ-Vol17-No1-1
View Abstract

Abstract:
In this paper we use the Divisia index approach to decompose emission changes of SO2, NOx and CO2 from major economic sectors in Taiwan during 1980 to 1992. The study highlights the interrelationships between energy use and environmental quality, and provides insights for policy making. The emission changes are decomposed into five components-pollution coefficient, fuel mix, energy intensity, economic growth and industrial structure. Of all components analyzed, economic growth had the largest positive effect on emission changes for Taiwan's major economic sectors. Emissions of SO2 in industry and other sectors showed a decreasing trend due to fuel quality improvements and pollution control. However, NOx and CO2 emissions increased sharply in all sectors. Comparisons were also made with Germany, Japan and USA. This study hay shown that improvement in energy efficiency, pollution control and fuel substitution are major options to reduce SO2, NOx and CO2 emissions.



Gasoline Tax as a Corrective Tax: Estimates for the United States, 1970-1991

Jonathan Haughton and Soumodip Sarkar

Year: 1996
Volume: Volume17
Number: Number 2
DOI: 10.5547/ISSN0195-6574-EJ-Vol17-No2-6
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Abstract:
Gasoline consumption creates externalities, through pollution, road congestion, accidents, and import dependence. Mat effect would a higher gasoline tax have on the related magnitudes: gasoline consumption, miles driven, and road fatalities? In this paper, separate models are estimated for gasoline use per mile, miles driven per driver, and fatalities per mile driven. We use data from 50 U.S. states and DC for 1970 through 1991, with a variety of stochastic specifications. The own-price elasticity of demand for gasoline is derived from projections with, and without, a higher gasoline tax, and is found to be between -0.12 and -0.17 in the short-run, and between -0.23 and -0.35 in the long-run. A tax of $1 per gallon would cut use by 15-20%, miles driven by 11-12%, and fatalities by 16 18% over 10 years, while raising almost $100 billion in revenue annually.



Decomposition of Aggregate Energy and Gas Emission Intensities for Industry: A Refined Divisia Index Method

B. W. Ang and Ki-Hong Choi

Year: 1997
Volume: Volume18
Number: Number 3
DOI: 10.5547/ISSN0195-6574-EJ-Vol18-No3-3
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Abstract:
Several methods for decomposing energy consumption or energy-induced gas emissions in industry have been proposed by various analysts. Two commonly encountered problems in the application of these methods are the existence of a residual after decomposition and the handling of the value zero In the data set. To overcome these two problems, we modify the often used Divisia index decomposition method by replacing the arithmetic mean weight function by a logarithmic one. This refined Divisia index method can be shown to give perfect decomposition with no residual. It also gives converging decomposition results when the zero values in the data set are replaced by a sufficiently small number. The properties of the method are highlighted using the data of the Korean industry.



Decomposition of Aggregate CO2 Emissions in the OECD: 1960-1995

J. W. Sun

Year: 1999
Volume: Volume20
Number: Number 3
DOI: 10.5547/ISSN0195-6574-EJ-Vol20-No3-7
View Abstract

Abstract:
This paper analyzes the change of aggregate CO2 emissions in the, OECD from 1960 to 1995 based on a complete decomposition approach. The, study indicates that developed countries have achieved a considerable decrease in their CO2 emissions mainly due to improved energy efficiency and fuel switching. However, some member countries of the OECD have found it difficult to achieve the environmental targets set at Rio de Janeiro in 1992, and should reconsider their energy policies in light of information given at the UN Climate, Change Conference in Kyoto.




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