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Residential energy consumption: A convergence analysis across Chinese regions

Author

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  • Herrerias, M.J.
  • Aller, Carlos
  • Ordóñez, Javier

Abstract

The process of urbanization and the raise of living standards in China have led an increasing trend in the patterns of residential consumption. Projections for the population growth rate in urban areas do not paint a very optimistic picture for energy conservation policies. In addition, the concentration of economic activities around coastal areas calls for new prospects to be formulated for energy policy. In this context, the objective of this paper is twofold. First, we analyse the effect of the urbanization process of the Chinese economy in terms of the long-run patterns of residential energy consumption at national level. By using the concept of club convergence, we examine whether electricity and coal consumption in rural and urban areas converge to the same long-run equilibrium or whether in fact they diverge. Second, the impact of the regional concentration of the economic activity on energy consumption patterns is also assessed by source of energy across Chinese regions from 1995 to 2011. Our results suggest that the process of urbanization has led to coal being replaced by electricity in urban residential energy consumption. In rural areas, the evidence is mixed. The club convergence analysis confirms that rural and urban residential energy consumption converge to different steady-states. At the regional level, we also confirm the effect of the regional concentration of economic activity on residential energy consumption. The existence of these regional clusters converging to different equilibrium levels is indicative of the need of regional-tailored set of energy policies in China.

Suggested Citation

  • Herrerias, M.J. & Aller, Carlos & Ordóñez, Javier, 2017. "Residential energy consumption: A convergence analysis across Chinese regions," Energy Economics, Elsevier, vol. 62(C), pages 371-381.
    • Handle: RePEc:eee:eneeco:v:62:y:2017:i:c:p:371-381
    DOI: 10.1016/j.eneco.2016.06.006
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    More about this item

    Keywords

    Club convergence; Transition paths; Chinese regions; Residential energy consumption;
    All these keywords.

    JEL classification:

    • C20 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - General
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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