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An Empirical Analysis of Engel Curve on Energy for Households in Sabah and Sarawak Based on Location and Income Group

Author

Listed:
  • Vivin Vincent Chandran
  • Caroline Geetha
  • Kwang Jing Yii
  • Amran Ahmed

    (Universiti Malaysia Sabah, Malaysia)

Abstract

The study was focused in forming an empirical model of Engel curve on energy for households in Sabah and Sarawak. Open-ended questionnaire was used as an instrument of study involving 1,002 respondents in Sabah and Sarawak. The dependent variable was budget share of energy expenditure meanwhile the independent variables were total household expenditure, age, household size, educational level, gender and regional variables. The Ordinary Least Square estimation was carried out on the cross sectional data. The coefficients were used to estimate the Engel curve expenditure elasticities. The findings revealed that total household expenditure (income) and household size were the important determinant in explaining the energy expenditure. Meanwhile the estimation of Engel curve expenditure elasticities showed that energy was a necessity good for all income groups in both urban and rural areas. Low income group was found to be more sensitive on energy expenditure to the changes in household income.

Suggested Citation

  • Vivin Vincent Chandran & Caroline Geetha & Kwang Jing Yii & Amran Ahmed, 2015. "An Empirical Analysis of Engel Curve on Energy for Households in Sabah and Sarawak Based on Location and Income Group," Journal of Developing Areas, Tennessee State University, College of Business, vol. 49(5), pages 239-251, Special I.
    • Handle: RePEc:jda:journl:vol.49:year:2015:issue5:pp:239-251
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    Cited by:

    1. Shengqing Xu & Tao Wang, 2017. "On energy equity and China’s policy choices," Energy & Environment, , vol. 28(3), pages 288-301, May.

    More about this item

    Keywords

    Engel Curve; Energy; Expenditure Elasticity; Households; Location; Income Group;
    All these keywords.

    JEL classification:

    • C13 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods and Methodology: General - - - Estimation: General
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
    • Q49 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Other
    • R22 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Other Demand

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