Decoupling Economic Growth and Energy Use: An Empirical Cross-Country Analysis for 10 Manufacturing Sectors

Tinbergen Institute Discussion Paper No. 04-005/3

41 Pages Posted: 25 Jun 2004

See all articles by Peter Mulder

Peter Mulder

VU University Amsterdam - Department of Spatial Economics

Henri L. F. de Groot

Vrije Universiteit Amsterdam; Tinbergen Institute

Date Written: January 2004

Abstract

This paper provides an empirical analysis of decoupling economic growth and energy use and its various determinants by exploring trends in energy - and labour productivity across 10 manufacturing sectors and 14 OECD countries for the period 1970-1997. We explicitly aim to trace back aggregate developments in the manufacturing sector to developments at the level of individual subsectors. A cross-country decomposition analysis reveals that in some countries structural changes contributed considerably to aggregate manufacturing energy-productivity growth and, hence, to decoupling, while in other countries they partly offset energy-efficiency improvements. In contrast, structural changes only play a minor role in explaining aggregate manufacturing labour-productivity developments. Furthermore, we find labour-productivity growth to be higher on average than energy-productivity growth. Over time, this bias towards labour-productivity growth is increasing in the aggregate manufacturing sector, while it is decreasing in most manufacturing subsectors.

Keywords: Energy productivity, labour productivity, convergence, sectoral analysis

JEL Classification: O13, O47, O5, Q4

Suggested Citation

Mulder, Peter and de Groot, Henri L.F., Decoupling Economic Growth and Energy Use: An Empirical Cross-Country Analysis for 10 Manufacturing Sectors (January 2004). Tinbergen Institute Discussion Paper No. 04-005/3, Available at SSRN: https://ssrn.com/abstract=558563 or http://dx.doi.org/10.2139/ssrn.558563

Peter Mulder

VU University Amsterdam - Department of Spatial Economics ( email )

De Boelelaan 1105
Amsterdam, 1081 HV
Netherlands
+31205982371 (Phone)

Henri L.F. De Groot (Contact Author)

Vrije Universiteit Amsterdam ( email )

De Boelelaan 1105
Amsterdam, 1081 HV
Netherlands
0640494981 (Phone)
2135 DL (Fax)

Tinbergen Institute

Gustav Mahlerplein 17
Amsterdam, 1082 MS
Netherlands

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