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Energy trade efficiency and its determinants: A Malmquist index approach

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  • Sheng, Yu
  • Wu, Yanrui
  • Shi, Xunpeng
  • Zhang, Dandan

Abstract

This paper adopts the Malmquist index approach to investigate multi-product energy trade efficiency and its determinants from an empirical perspective. Using trade statistics of coal, oil and gas of 40 countries over the period of 1995 to 2008, we found that the efficiency of bilateral energy trade ranged between 0.26 and 0.35 when imperfect substitution between different energy products is taken into account. This measure is significantly lower than those obtained from traditional gravity models. It suggests that the ability of cross-product substitution affects trade efficiency improvement which results from regional market integration and related trade policy. The results provide useful insights on predicting the pattern of future energy trade and hence have important implications for relevant countries to prioritize product-specific trade policies.

Suggested Citation

  • Sheng, Yu & Wu, Yanrui & Shi, Xunpeng & Zhang, Dandan, 2015. "Energy trade efficiency and its determinants: A Malmquist index approach," Energy Economics, Elsevier, vol. 50(C), pages 306-314.
    • Handle: RePEc:eee:eneeco:v:50:y:2015:i:c:p:306-314
    DOI: 10.1016/j.eneco.2015.05.019
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    Cited by:

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    5. Bilgili, Faik & Kassouri, Yacouba & Kuşkaya, Sevda & Majok Garang, Aweng Peter, 2024. "The dynamic nexus of oil price fluctuations and banking sector in China: A continuous wavelet analysis," Resources Policy, Elsevier, vol. 88(C).
    6. Sueyoshi, Toshiyuki & Yuan, Yan, 2016. "Marginal Rate of Transformation and Rate of Substitution measured by DEA environmental assessment: Comparison among European and North American nations," Energy Economics, Elsevier, vol. 56(C), pages 270-287.
    7. Adel Hatami-Marbini & Aliasghar Arabmaldar & John Otu Asu, 2022. "Robust productivity growth and efficiency measurement with undesirable outputs: evidence from the oil industry," OR Spectrum: Quantitative Approaches in Management, Springer;Gesellschaft für Operations Research e.V., vol. 44(4), pages 1213-1254, December.
    8. Xie, Wen-Jie & Wei, Na & Zhou, Wei-Xing, 2023. "An interpretable machine-learned model for international oil trade network," Resources Policy, Elsevier, vol. 82(C).
    9. Tim Gaebert & Michaela Staňková, 2020. "Efficiency Development in the German Pharmaceutical Market," Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis, Mendel University Press, vol. 68(5), pages 877-884.
    10. Liao, Hua & Du, Yun-Fei & Huang, Zhimin & Wei, Yi-Ming, 2016. "Measuring energy economic efficiency: A mathematical programming approach," Applied Energy, Elsevier, vol. 179(C), pages 479-487.
    11. Lin, Boqiang & Xu, Mengmeng, 2018. "Regional differences on CO2 emission efficiency in metallurgical industry of China," Energy Policy, Elsevier, vol. 120(C), pages 302-311.
    12. Mei-Mei Xue & Gang Wu & Qian Wang & Yun-Fei Yao & Qiao-Mei Liang, 2019. "Socioeconomic impacts of a shortage in imported oil supply: case of China," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 99(3), pages 1415-1430, December.
    13. Zhao, Yong & Shi, Xunpeng & Song, Feng, 2020. "Has Chinese outward foreign direct investment in energy enhanced China's energy security?," Energy Policy, Elsevier, vol. 146(C).
    14. Fatemeh Rahimzadeh & Hamed Pirpour & Bahman P. Ebrahimi, 2022. "The impact of economic sanctions on the efficiency of bilateral energy exports: the case of Iran," SN Business & Economics, Springer, vol. 2(9), pages 1-18, September.
    15. Yazdani, Mehdi & Pirpour, Hamed, 2020. "Evaluating the effect of intra-industry trade on the bilateral trade productivity for petroleum products of Iran," Energy Economics, Elsevier, vol. 86(C).
    16. Zhang, Jing, 2019. "Oil and gas trade between China and countries and regions along the ‘Belt and Road’: A panoramic perspective," Energy Policy, Elsevier, vol. 129(C), pages 1111-1120.
    17. Halkos, George & Bampatsou, Christina, 2016. "Investigating the effect of efficiency and technical changes on productivity," MPRA Paper 76287, University Library of Munich, Germany.

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    More about this item

    Keywords

    Energy trade efficiency; Malmquist index; Energy market integration;
    All these keywords.

    JEL classification:

    • F - International Economics
    • O4 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity
    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy

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