The relationship between energy intensity and income levels: Forecasting long term energy demand in Asian emerging countries

Journal Article · Thu Jan 01 04:00:00 EST 1998 · Energy Journal

DOI:https://doi.org/10.5547/ISSN0195-6574-EJ-Vol19-No4-4· OSTI ID:6184487

Galli, R ^[1]

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1. Birkbeck Coll., London (United Kingdom) Univ. della Svizzera Italiana, Lugano (Switzerland). Facolta di Scienze Economiche

This paper analyzes long-term trends in energy intensity for ten Asian emerging countries to test for a non-monotonic relationship between energy intensity and income in the author's sample. Energy demand functions are estimated during 1973--1990 using a quadratic function of log income. The long-run coefficient on squared income is found to be negative and significant, indicating a change in trend of energy intensity. The estimates are then used to evaluate a medium-term forecast of energy demand in the Asian countries, using both a log-linear and a quadratic model. It is found that in medium to high income countries the quadratic model performs better than the log-linear, with an average error of 9% against 43% in 1995. For the region as a whole, the quadratic model appears more adequate with a forecast error of 16% against 28% in 1995. These results are consistent with a process of dematerialization, which occurs as a result of a reduction of resource use per unit of GDP once an economy passes some threshold level of GDP per capita.

• OSTI ID: 6184487
• Journal Information: Energy Journal, Journal Name: Energy Journal Vol. 19:4; ISSN ENJODN; ISSN 0195-6574
• Country of Publication: United States
• Language: English

Related Subjects

29 ENERGY PLANNING, POLICY, AND ECONOMY
290201 -- Energy Planning & Policy-- Economics-- (1992-)
293000* -- Energy Planning & Policy-- Policy
Legislation
& Regulation
ASIA
DEMAND
ENERGY DEMAND
FORECASTING
GROSS DOMESTIC PRODUCT
INCOME