IDEAS home Printed from https://ideas.repec.org/a/gam/jijerp/v20y2023i4p2855-d1059371.html
   My bibliography  Save this article

The Impact of Economic Policy Uncertainty on Regional Total-Factor Energy Productivity in China

Author

Listed:
  • Bin Wang

    (School of Economics, Wuhan Textile University, Wuhan 430200, China)

  • Chenyang Meng

    (School of Economics, Huazhong University of Science and Technology, Wuhan 430074, China)

  • Hongwei Yu

    (Institute of Quality Development Strategy, Wuhan University, Wuhan 430072, China)

Abstract

This paper investigates the effect and possible mechanism of implicit macroeconomic policy uncertainty on regional energy productivity in China. This study takes the unexpected output of environmental pollution from energy consumption into account and uses the DEA-SBM method to measure the regional total-factor energy productivity (RTFEP) of prefecture cities in China from 2003 to 2017. Based on the economic policy uncertainty (EPU) index constructed by Baker et al. this paper estimates the effects of EPU on RTFEP and finds that there is a significant negative relationship between them. Specifically, for every unit increase in EPU, RTFEP will decrease by 5.7%. This paper further examines the mechanism of EPU on RTFEP from the perspective of the market and the government and finds that EPU exerts a restraining effect on RTFEP by affecting the consumption structure of the energy market and government intervention in the economy. In addition, the results show that there is heterogeneity in the impact of EPU on RTFEP which varies between resource-based cities at different development stages and different dominant resources. Finally, this paper proposes to cope with the negative impact of EPU on RTFEP by optimizing the energy consumption structure, regulating government investment areas, and transforming the economic development mode.

Suggested Citation

  • Bin Wang & Chenyang Meng & Hongwei Yu, 2023. "The Impact of Economic Policy Uncertainty on Regional Total-Factor Energy Productivity in China," IJERPH, MDPI, vol. 20(4), pages 1-20, February.
    • Handle: RePEc:gam:jijerp:v:20:y:2023:i:4:p:2855-:d:1059371
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/1660-4601/20/4/2855/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/1660-4601/20/4/2855/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Scott R. Baker & Nicholas Bloom, 2013. "Does Uncertainty Reduce Growth? Using Disasters as Natural Experiments," NBER Working Papers 19475, National Bureau of Economic Research, Inc.
    2. Hirst, Eric, 1991. "Improving energy efficiency in the USA : The federal role," Energy Policy, Elsevier, vol. 19(6), pages 567-577.
    3. Grossman, G.M & Krueger, A.B., 1991. "Environmental Impacts of a North American Free Trade Agreement," Papers 158, Princeton, Woodrow Wilson School - Public and International Affairs.
    4. Boyd, Gale A. & Pang, Joseph X., 2000. "Estimating the linkage between energy efficiency and productivity," Energy Policy, Elsevier, vol. 28(5), pages 289-296, May.
    5. Scott R. Baker & Nicholas Bloom & Steven J. Davis, 2016. "Measuring Economic Policy Uncertainty," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 131(4), pages 1593-1636.
    6. Steven J. Davis, 2016. "An Index of Global Economic Policy Uncertainty," NBER Working Papers 22740, National Bureau of Economic Research, Inc.
    7. Yeh, Tsai-lien & Chen, Tser-yieth & Lai, Pei-ying, 2010. "A comparative study of energy utilization efficiency between Taiwan and China," Energy Policy, Elsevier, vol. 38(5), pages 2386-2394, May.
    8. Maddison, Angus, 1987. "Growth and Slowdown in Advanced Capitalist Economies: Techniques of Quantitative Assessment," Journal of Economic Literature, American Economic Association, vol. 25(2), pages 649-698, June.
    9. Fisher-Vanden, Karen & Jefferson, Gary H. & Jingkui, Ma & Jianyi, Xu, 2006. "Technology development and energy productivity in China," Energy Economics, Elsevier, vol. 28(5-6), pages 690-705, November.
    10. Hu, Jin-Li & Wang, Shih-Chuan, 2006. "Total-factor energy efficiency of regions in China," Energy Policy, Elsevier, vol. 34(17), pages 3206-3217, November.
    11. Tone, Kaoru, 2001. "A slacks-based measure of efficiency in data envelopment analysis," European Journal of Operational Research, Elsevier, vol. 130(3), pages 498-509, May.
    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. Shuangjie Li & Li Li & Liming Wang, 2020. "2030 Target for Energy Efficiency and Emission Reduction in the EU Paper Industry," Energies, MDPI, vol. 14(1), pages 1-17, December.
    2. Wu, F. & Fan, L.W. & Zhou, P. & Zhou, D.Q., 2012. "Industrial energy efficiency with CO2 emissions in China: A nonparametric analysis," Energy Policy, Elsevier, vol. 49(C), pages 164-172.
    3. Du, Minzhe & Wang, Bing & Zhang, Ning, 2018. "National research funding and energy efficiency: Evidence from the National Science Foundation of China," Energy Policy, Elsevier, vol. 120(C), pages 335-346.
    4. Jebali, Eya & Essid, Hédi & Khraief, Naceur, 2017. "The analysis of energy efficiency of the Mediterranean countries: A two-stage double bootstrap DEA approach," Energy, Elsevier, vol. 134(C), pages 991-1000.
    5. Chang, Ming-Chung, 2013. "A comment on the calculation of the total-factor energy efficiency (TFEE) index," Energy Policy, Elsevier, vol. 53(C), pages 500-504.
    6. Zhou, Anhua & Li, Jun, 2021. "Investigate the impact of market reforms on the improvement of manufacturing energy efficiency under China’s provincial-level data," Energy, Elsevier, vol. 228(C).
    7. Wang, Ke & Wei, Yi-Ming & Zhang, Xian, 2012. "A comparative analysis of China’s regional energy and emission performance: Which is the better way to deal with undesirable outputs?," Energy Policy, Elsevier, vol. 46(C), pages 574-584.
    8. Choi, Yongrok & Zhang, Ning & Zhou, P., 2012. "Efficiency and abatement costs of energy-related CO2 emissions in China: A slacks-based efficiency measure," Applied Energy, Elsevier, vol. 98(C), pages 198-208.
    9. Georgia Makridou, Kostas Andriosopoulos, Michael Doumpos, and Constantin Zopounidis, 2015. "A Two-stage approach for energy efficiency analysis in European Union countries," The Energy Journal, International Association for Energy Economics, vol. 0(Number 2).
    10. Zhou, P. & Ang, B.W. & Poh, K.L., 2008. "A survey of data envelopment analysis in energy and environmental studies," European Journal of Operational Research, Elsevier, vol. 189(1), pages 1-18, August.
    11. Liang Chun Lu & Yung-ho Chiu & Shih-Yung Chiu & Tzu-Han Chang, 2022. "Do Forests help environmental development of Cities in China?," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 24(5), pages 6602-6629, May.
    12. Zhu, Lin & Wang, Yong & Shang, Peipei & Qi, Lin & Yang, Guangchun & Wang, Ying, 2019. "Improvement path, the improvement potential and the dynamic evolution of regional energy efficiency in China: Based on an improved nonradial multidirectional efficiency analysis," Energy Policy, Elsevier, vol. 133(C).
    13. Yan Wu & Cong Hu & Xunpeng Shi, 2021. "Heterogeneous Effects of the Belt and Road Initiative on Energy Efficiency in Participating Countries," Energies, MDPI, vol. 14(18), pages 1-21, September.
    14. Wei, Wei & Hu, Haiqing & Chang, Chun-Ping, 2022. "Why the same degree of economic policy uncertainty can produce different outcomes in energy efficiency? New evidence from China," Structural Change and Economic Dynamics, Elsevier, vol. 60(C), pages 467-481.
    15. Juan M. Londono & Sai Ma & Beth Anne Wilson, 2021. "The Global Transmission of Real Economic Uncertainty," International Finance Discussion Papers 1317, Board of Governors of the Federal Reserve System (U.S.).
    16. Yongyi Cheng & Liheng Lu & Tianyuan Shao & Manhong Shen & Laiqun Jin, 2018. "Decomposition Analysis of Factors Affecting Changes in Industrial Wastewater Emission Intensity in China: Based on a SSBM-GMI Approach," IJERPH, MDPI, vol. 15(12), pages 1-23, December.
    17. Bian, Yiwen & Hu, Miao & Wang, Yousen & Xu, Hao, 2016. "Energy efficiency analysis of the economic system in China during 1986–2012: A parallel slacks-based measure approach," Renewable and Sustainable Energy Reviews, Elsevier, vol. 55(C), pages 990-998.
    18. Iftikhar, Yaser & Wang, Zhaohua & Zhang, Bin & Wang, Bo, 2018. "Energy and CO2 emissions efficiency of major economies: A network DEA approach," Energy, Elsevier, vol. 147(C), pages 197-207.
    19. Lai-Wang Wang & Ke-Duc Le & Thi-Duong Nguyen, 2019. "Assessment of the Energy Efficiency Improvement of Twenty-Five Countries: A DEA Approach," Energies, MDPI, vol. 12(8), pages 1-14, April.
    20. Ying Sun & Fengqin Liu & Huaping Sun, 2022. "Does Standardization Improve Carbon Emission Efficiency as Soft Infrastructure? Evidence from China," Energies, MDPI, vol. 15(6), pages 1-17, March.

    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:gam:jijerp:v:20:y:2023:i:4:p:2855-:d:1059371. 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: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    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.