The energy consumption and employment relationship: A clarification

Journal Article · · Journal of Energy and Development; (United States)

OSTI ID:6807392

Murry, D A; Dan, G D

Several authors have shown empirically that energy and labor inputs are substitutes in a US gross domestic product (GDP) production function and that a constraint on energy availability will cause a slight increase in total employment. That conclusion also implies that labor and energy consumption are substitutes. During a period of economic expansion, as GDP rises, so does energy consumption, and one theoretically can expect that economic expansion will result in higher employment. More specifically, when the economy is growing rapidly, both energy consumption and employment will be rising. This simultaneous growth of energy consumption and employment, which may be at different rates, is defined as an income effect' between them. Consequently, in addition to the commonly recognized energy-labor force substitution, there is an additional relationship, an income effect,' between energy consumption and employment. These relationships, a substitution effect and an income effect, move in opposite directions and the net effect, i.e., positive, negative, or neutral, depends on their relative strengths. In this paper, the authors reexamine the relationship between energy consumption and employment and explain the seemingly conflicting results in the literature. 1 fig., 5 tabs.

• OSTI ID: 6807392
• Journal Information: Journal of Energy and Development; (United States), Journal Name: Journal of Energy and Development; (United States) Vol. 16:1; ISSN 0361-4476; ISSN JENDD2
• Country of Publication: United States
• Language: English

Related Subjects

29 ENERGY PLANNING, POLICY, AND ECONOMY
290100* -- Energy Planning & Policy-- Energy Analysis & Modeling
290200 -- Energy Planning & Policy-- Economics & Sociology
AVAILABILITY
COMPLEMENT
DATA
DEVELOPED COUNTRIES
ECONOMY
EMPLOYMENT
ENERGY
ENERGY CONSUMPTION
ERRORS
EXPANSION
GROSS DOMESTIC PRODUCT
GROWTH
INCOME
INFORMATION
LABOR
NORTH AMERICA
ORGANIC COMPOUNDS
PAPER
PRODUCTION
PROTEINS
USA
WOOD