IDEAS home Printed from https://ideas.repec.org/a/eee/enepol/v72y2014icp235-248.html
   My bibliography  Save this article

Using latent variable approach to estimate China׳s economy-wide energy rebound effect over 1954–2010

Author

Listed:
  • Shao, Shuai
  • Huang, Tao
  • Yang, Lili

Abstract

The energy rebound effect has been a significant issue in China, which is undergoing economic transition, since it reflects the effectiveness of energy-saving policy relying on improved energy efficiency. Based on the IPAT equation and Brookes׳ explanation of the rebound effect, this paper develops an alternative estimation model of the rebound effect. By using the estimation model and latent variable approach, which is achieved through a time-varying coefficient state space model, we estimate China׳s economy-wide energy rebound effect over 1954–2010. The results show that the rebound effect evidently exists in China as a result of the annual average of 39.73% over 1954–2010. Before and after the implementation of China׳s reform and opening-up policy in 1978, the rebound effects are 47.24% and 37.32%, with a strong fluctuation and a circuitously downward trend, respectively, indicating that a stable political environment and the development of market economy system facilitate the effectiveness of energy-saving policy. Although the energy-saving effect of improving energy efficiency has been partly realised, there remains a large energy-saving potential in China.

Suggested Citation

  • Shao, Shuai & Huang, Tao & Yang, Lili, 2014. "Using latent variable approach to estimate China׳s economy-wide energy rebound effect over 1954–2010," Energy Policy, Elsevier, vol. 72(C), pages 235-248.
    • Handle: RePEc:eee:enepol:v:72:y:2014:i:c:p:235-248
    DOI: 10.1016/j.enpol.2014.04.041
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0301421514002766
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.enpol.2014.04.041?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Brookes, Len, 1990. "The greenhouse effect: the fallacies in the energy efficiency solution," Energy Policy, Elsevier, vol. 18(2), pages 199-201, March.
    2. Sorrell, Steve & Dimitropoulos, John, 2008. "The rebound effect: Microeconomic definitions, limitations and extensions," Ecological Economics, Elsevier, vol. 65(3), pages 636-649, April.
    3. A. Greening, Lorna & Greene, David L. & Difiglio, Carmen, 2000. "Energy efficiency and consumption -- the rebound effect -- a survey," Energy Policy, Elsevier, vol. 28(6-7), pages 389-401, June.
    4. Frondel, Manuel & Ritter, Nolan & Vance, Colin, 2012. "Heterogeneity in the rebound effect: Further evidence for Germany," Energy Economics, Elsevier, vol. 34(2), pages 461-467.
    5. Lin, Boqiang & Jiang, Zhujun, 2012. "Designation and influence of household increasing block electricity tariffs in China," Energy Policy, Elsevier, vol. 42(C), pages 164-173.
    6. Shiyi Chen, 2011. "The Abatement of Carbon Dioxide Intensity in China: Factors Decomposition and Policy Implications," The World Economy, Wiley Blackwell, vol. 34, pages 1148-1167, July.
    7. Glomsrod, Solveig & Taoyuan, Wei, 2005. "Coal cleaning: a viable strategy for reduced carbon emissions and improved environment in China?," Energy Policy, Elsevier, vol. 33(4), pages 525-542, March.
    8. Sorrell, Steve, 2009. "Jevons' Paradox revisited: The evidence for backfire from improved energy efficiency," Energy Policy, Elsevier, vol. 37(4), pages 1456-1469, April.
    9. Zhang, Ming & Liu, Xiao & Wang, Wenwen & Zhou, Min, 2013. "Decomposition analysis of CO2 emissions from electricity generation in China," Energy Policy, Elsevier, vol. 52(C), pages 159-165.
    10. Gregory C. Chow, 1993. "Capital Formation and Economic Growth in China," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 108(3), pages 809-842.
    11. Wang, Wenwen & Liu, Xiao & Zhang, Ming & Song, Xuefeng, 2014. "Using a new generalized LMDI (logarithmic mean Divisia index) method to analyze China's energy consumption," Energy, Elsevier, vol. 67(C), pages 617-622.
    12. Guerra, Ana-Isabel & Sancho, Ferran, 2010. "Rethinking economy-wide rebound measures: An unbiased proposal," Energy Policy, Elsevier, vol. 38(11), pages 6684-6694, November.
    13. Shao, Shuai & Yang, Lili & Yu, Mingbo & Yu, Mingliang, 2011. "Estimation, characteristics, and determinants of energy-related industrial CO2 emissions in Shanghai (China), 1994-2009," Energy Policy, Elsevier, vol. 39(10), pages 6476-6494, October.
    14. Druckman, Angela & Chitnis, Mona & Sorrell, Steve & Jackson, Tim, 2011. "Missing carbon reductions? Exploring rebound and backfire effects in UK households," Energy Policy, Elsevier, vol. 39(6), pages 3572-3581, June.
    15. Lin, Boqiang & Liu, Xia, 2013. "Reform of refined oil product pricing mechanism and energy rebound effect for passenger transportation in China," Energy Policy, Elsevier, vol. 57(C), pages 329-337.
    16. Barry Bosworth & Susan M. Collins, 2008. "Accounting for Growth: Comparing China and India," Journal of Economic Perspectives, American Economic Association, vol. 22(1), pages 45-66, Winter.
    17. David L. Greene & James R. Kahn & Robert C. Gibson, 1999. "Fuel Economy Rebound Effect for U.S. Household Vehicles," The Energy Journal, International Association for Energy Economics, vol. 0(Number 3), pages 1-31.
    18. Jaccard, Mark & Bataille, Chris, 2000. "Estimating future elasticities of substitution for the rebound debate," Energy Policy, Elsevier, vol. 28(6-7), pages 451-455, June.
    19. Freire-González, Jaume, 2011. "Methods to empirically estimate direct and indirect rebound effect of energy-saving technological changes in households," Ecological Modelling, Elsevier, vol. 223(1), pages 32-40.
    20. Bentzen, Jan, 2004. "Estimating the rebound effect in US manufacturing energy consumption," Energy Economics, Elsevier, vol. 26(1), pages 123-134, January.
    21. Jin, Sang-Hyeon, 2007. "The effectiveness of energy efficiency improvement in a developing country: Rebound effect of residential electricity use in South Korea," Energy Policy, Elsevier, vol. 35(11), pages 5622-5629, November.
    22. Lin, Boqiang & Liu, Xia, 2012. "Dilemma between economic development and energy conservation: Energy rebound effect in China," Energy, Elsevier, vol. 45(1), pages 867-873.
    23. Allan, Grant & Hanley, Nick & McGregor, Peter & Swales, Kim & Turner, Karen, 2007. "The impact of increased efficiency in the industrial use of energy: A computable general equilibrium analysis for the United Kingdom," Energy Economics, Elsevier, vol. 29(4), pages 779-798, July.
    24. Haas, Reinhard & Biermayr, Peter, 2000. "The rebound effect for space heating Empirical evidence from Austria," Energy Policy, Elsevier, vol. 28(6-7), pages 403-410, June.
    25. Schipper, Lee & Grubb, Michael, 2000. "On the rebound? Feedback between energy intensities and energy uses in IEA countries," Energy Policy, Elsevier, vol. 28(6-7), pages 367-388, June.
    26. Saunders, Harry D., 2000. "Does predicted rebound depend on distinguishing between energy and energy services?," Energy Policy, Elsevier, vol. 28(6-7), pages 497-500, June.
    27. Chow, Gregory C & Li, Kui-Wai, 2002. "China's Economic Growth: 1952-2010," Economic Development and Cultural Change, University of Chicago Press, vol. 51(1), pages 247-256, October.
    28. Richard York & Eugene A. Rosa & Thomas Dietz, 2002. "Bridging Environmental Science with Environmental Policy: Plasticity of Population, Affluence, and Technology," Social Science Quarterly, Southwestern Social Science Association, vol. 83(1), pages 18-34, March.
    29. Song, Malin & Wang, Shuhong & Yu, Huayin & Yang, Li & Wu, Jie, 2011. "To reduce energy consumption and to maintain rapid economic growth: Analysis of the condition in China based on expended IPAT model," Renewable and Sustainable Energy Reviews, Elsevier, vol. 15(9), pages 5129-5134.
    30. Brookes, L. G., 1992. "Energy efficiency and economic fallacies: a reply," Energy Policy, Elsevier, vol. 20(5), pages 390-392, May.
    31. Chitnis, Mona & Sorrell, Steve & Druckman, Angela & Firth, Steven K. & Jackson, Tim, 2013. "Turning lights into flights: Estimating direct and indirect rebound effects for UK households," Energy Policy, Elsevier, vol. 55(C), pages 234-250.
    32. Brookes, L. G., 1993. "Energy efficiency fallacies: the debate concluded," Energy Policy, Elsevier, vol. 21(4), pages 346-347, April.
    33. Feng, Kuishuang & Hubacek, Klaus & Guan, Dabo, 2009. "Lifestyles, technology and CO2 emissions in China: A regional comparative analysis," Ecological Economics, Elsevier, vol. 69(1), pages 145-154, November.
    34. Antal, Miklós & van den Bergh, Jeroen C.J.M., 2014. "Re-spending rebound: A macro-level assessment for OECD countries and emerging economies," Energy Policy, Elsevier, vol. 68(C), pages 585-590.
    35. Berkhout, Peter H. G. & Muskens, Jos C. & W. Velthuijsen, Jan, 2000. "Defining the rebound effect," Energy Policy, Elsevier, vol. 28(6-7), pages 425-432, June.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Yang, Lisha & Li, Zhi, 2017. "Technology advance and the carbon dioxide emission in China – Empirical research based on the rebound effect," Energy Policy, Elsevier, vol. 101(C), pages 150-161.
    2. Li, Ke & Jiang, Zhujun, 2016. "The impacts of removing energy subsidies on economy-wide rebound effects in China: An input-output analysis," Energy Policy, Elsevier, vol. 98(C), pages 62-72.
    3. David Font Vivanco & Jaume Freire‐González & Ray Galvin & Tilman Santarius & Hans Jakob Walnum & Tamar Makov & Serenella Sala, 2022. "Rebound effect and sustainability science: A review," Journal of Industrial Ecology, Yale University, vol. 26(4), pages 1543-1563, August.
    4. Lin, Boqiang & Chen, Yufang & Zhang, Guoliang, 2017. "Technological progress and rebound effect in China's nonferrous metals industry: An empirical study," Energy Policy, Elsevier, vol. 109(C), pages 520-529.
    5. Thomas, Brinda A. & Azevedo, Inês L., 2013. "Estimating direct and indirect rebound effects for U.S. households with input–output analysis Part 1: Theoretical framework," Ecological Economics, Elsevier, vol. 86(C), pages 199-210.
    6. Li, Ke & Zhang, Ning & Liu, Yanchu, 2016. "The energy rebound effects across China’s industrial sectors: An output distance function approach," Applied Energy, Elsevier, vol. 184(C), pages 1165-1175.
    7. Wang, Zhaohua & Han, Bai & Lu, Milin, 2016. "Measurement of energy rebound effect in households: Evidence from residential electricity consumption in Beijing, China," Renewable and Sustainable Energy Reviews, Elsevier, vol. 58(C), pages 852-861.
    8. Wen, Fenghua & Ye, Zhengke & Yang, Huaidong & Li, Ke, 2018. "Exploring the rebound effect from the perspective of household: An analysis of China's provincial level," Energy Economics, Elsevier, vol. 75(C), pages 345-356.
    9. Tufan Özsoy, 2024. "The “energy rebound effect” within the framework of environmental sustainability," Wiley Interdisciplinary Reviews: Energy and Environment, Wiley Blackwell, vol. 13(2), March.
    10. Lecca, Patrizio & McGregor, Peter G. & Swales, J. Kim & Turner, Karen, 2014. "The added value from a general equilibrium analysis of increased efficiency in household energy use," Ecological Economics, Elsevier, vol. 100(C), pages 51-62.
    11. Milin Lu & Zhaohua Wang, 2017. "Rebound effects for residential electricity use in urban China: an aggregation analysis based E-I-O and scenario simulation," Annals of Operations Research, Springer, vol. 255(1), pages 525-546, August.
    12. Lin, Boqiang & Liu, Xia, 2013. "Reform of refined oil product pricing mechanism and energy rebound effect for passenger transportation in China," Energy Policy, Elsevier, vol. 57(C), pages 329-337.
    13. Karen Turner, 2013. ""Rebound" Effects from Increased Energy Efficiency: A Time to Pause and Reflect," The Energy Journal, International Association for Energy Economics, vol. 0(Number 4).
    14. Ouyang, Xiaoling & Gao, Beiying & Du, Kerui & Du, Gang, 2018. "Industrial sectors' energy rebound effect: An empirical study of Yangtze River Delta urban agglomeration," Energy, Elsevier, vol. 145(C), pages 408-416.
    15. David I. Stern, 2010. "The Role of Energy in Economic Growth," CCEP Working Papers 0310, Centre for Climate & Energy Policy, Crawford School of Public Policy, The Australian National University.
    16. Toroghi, Shahaboddin H. & Oliver, Matthew E., 2019. "Framework for estimation of the direct rebound effect for residential photovoltaic systems," Applied Energy, Elsevier, vol. 251(C), pages 1-1.
    17. Yu, Xuewei & Moreno-Cruz, Juan & Crittenden, John C., 2015. "Regional energy rebound effect: The impact of economy-wide and sector level energy efficiency improvement in Georgia, USA," Energy Policy, Elsevier, vol. 87(C), pages 250-259.
    18. Ghoddusi, Hamed & Roy, Mandira, 2017. "Supply elasticity matters for the rebound effect and its impact on policy comparisons," Energy Economics, Elsevier, vol. 67(C), pages 111-120.
    19. Wang, Zhaohua & Lu, Milin & Wang, Jian-Cai, 2014. "Direct rebound effect on urban residential electricity use: An empirical study in China," Renewable and Sustainable Energy Reviews, Elsevier, vol. 30(C), pages 124-132.
    20. Blum, Bianca & Hübner, Julian & Müller, Sarah & Neumärker, Karl Justus Bernhard, 2018. "Challenges for sustainable environmental policy: Influencing factors of the rebound effect in energy efficiency improvements," The Constitutional Economics Network Working Papers 02-2018, University of Freiburg, Department of Economic Policy and Constitutional Economic Theory.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:enepol:v:72:y:2014:i:c:p:235-248. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/enpol .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.