We summarize what we know about energy and economic growth in a set of stylized facts. We combine... more We summarize what we know about energy and economic growth in a set of stylized facts. We combine analysis of a panel data set of 99 countries from 1971 to 2010 with analysis of some longer run historical data. Our key result is that over the last 40 years there has been a stable cross-sectional relationship between per capita energy use and income per capita with an elasticity of energy use with respect to income of less than unity. This implies that energy intensity has tended to decrease in countries that have become richer but not in others. We also find that over the last two centuries there has been convergence in energy intensity towards the current distribution, per capita energy use has tended to rise, energy quality to increase, and, though evidence is limited, the cost share of energy has declined.
This paper updates estimates of global anthropogenic sulfate emissions through 1993 and provides ... more This paper updates estimates of global anthropogenic sulfate emissions through 1993 and provides a time series of estimates for each year. We extend the methodology developed by Hameed and Dignon (1989) to include emissions from copper smelting and use estimates for US emissions between 1900 and 1940 which were not previously available. Emissions since 1986 show a slight rise due to an increase in the US followed by a slight decline and a continuing decline in emissions from the other OECD countries. Emissions from the rest of the world peak in 1989 and show a steep decline associated with recession and economic restructuring in Eastern Europe. The various emissions series are consistent with the historical record for the atmospheric concentration of non sea sulfates that is reconstructed from an ice core recovered from Greenland.
The issue of whether energy efficiency improvements will lower energy use or not is contentious. ... more The issue of whether energy efficiency improvements will lower energy use or not is contentious. We estimate the economy-wide rebound effect for Iran using a structural vector autoregressive model estimated with quarterly data from 1988:3 to 2018:1. The structural shocks are identified by independent component analysis, a statistical identification technique that does not require us to impose restrictions based on economic theory on the model. The results show that in response to an energy efficiency shock energy use falls initially, but returns to near its original level over time. The economy-wide rebound effect in Iran is 84% after 6 years and its confidence interval includes 100% implying that policies that encourage energy efficiency innovation will have limited longterm impact on energy use.
Improving energy efficiency is often considered to be one of the keys to reducing greenhouse gas ... more Improving energy efficiency is often considered to be one of the keys to reducing greenhouse gas emissions. However, efficiency gains also reduce the cost of energy services and may even reduce the price of energy, resulting in energy use rebounding and potential energy use savings being eaten up. There is only limited empirical research quantifying the economy-wide rebound effect that takes the dynamic economic responses to energy efficiency improvements into account. We use a Structural Factor-Augmented Vector Autoregressive model (S-FAVAR) that allows us to track how energy use changes in response to an energy efficiency improvement while accounting for a vast range of potential confounders. Our findings point to economy-wide rebound effects of 78% to 101% after two years in France, Germany, Italy, the U.K., and the U.S. These findings imply that energy efficiency innovations alone may be of limited help in reducing future energy use and emphasize the importance of tackling carbon emissions directly.
We review the literature on the economics of climate change with a focus on the evolution of the ... more We review the literature on the economics of climate change with a focus on the evolution of the literature from some of the early classic papers to the latest contributions. We divide the paper into three main sections: trends in greenhouse gas emissions, mitigation, and adaptation.
There has been extensive analysis of the drivers of carbon dioxide emissions from fossil fuel com... more There has been extensive analysis of the drivers of carbon dioxide emissions from fossil fuel combustion and cement production, which constituted only 55% of global greenhouse gas (GHG) emissions in 1970 and 65% in 2010. But there has been much less analysis of the drivers of greenhouse gases in general and especially of emissions of greenhouse gases from agriculture, forestry, and other land uses, which we call non-industrial emissions in this paper, that constituted 24% of total emissions in 2010. We statistically analyse the relationship between both industrial and non-industrial greenhouse gas emissions and economic growth and other potential drivers for 129 countries over the period from 1971 to 2010. Our analysis combines the three main approaches in the literature to investigating the evolution of emissions and income. We find that economic growth is a driver of both industrial and non-industrial emissions, though growth has twice the effect on industrial emissions. Both sources of emissions decline over time though this effect is larger for non-industrial emissions. There is also convergence in emissions intensity for both types of emissions but given these other effects there is no evidence for an environmental Kuznets curve.
Australian Journal of Agricultural and Resource Economics, 2003
The Environmental Kuznets Curve (EKC) hypothesis-an inverted U-shape relation between various ind... more The Environmental Kuznets Curve (EKC) hypothesis-an inverted U-shape relation between various indicators of environmental degradation and income per capitahas become one of the 'stylised facts' of environmental and resource economics. This is despite considerable criticism on both theoretical and empirical grounds. Cointegration analysis can be used to test the validity of such stylised facts when the data involved contain stochastic trends. In the present paper, we use cointegration analysis to test the EKC hypothesis using a panel dataset of sulfur emissions and GDP data for 74 countries over a span of 31 years. We find that the data is stochastically trending in the time-series dimension. Given this, and interpreting the EKC as a long run equilibrium relationship, support for the hypothesis requires that an appropriate model cointegrates and that sulfur emissions are a concave function of income. Individual and panel cointegration tests cast doubt on the general applicability of the hypothesised relationship. Even when we find cointegration, many of the relationships for individual countries are not concave. The results show that the EKC is a problematic concept, at least in the case of sulfur emissions. * The authors thank Peter Pedroni for providing econometrics code and comments on an earlier draft of the paper, and Chihwa Kao and Yongcheol Shin for providing Gauss code. We also thank Mick Common, Yongcheol Shin, and Quentin Grafton and two anonymous referees for useful comments. Kali Sanyal assembled the dataset.
Analysis of observational temperature records for the Northern and Southern hemispheres indicates... more Analysis of observational temperature records for the Northern and Southern hemispheres indicates a statistical relationship in which Northern Hemisphere temperature depends on temperature in the Southern Hemisphere. This pattern, which has strengthened over time, can be explained by the climatic effects of anthropogenic trace gases and tropospheric sulphate aerosols. A similar statistical pattern is produced by model simulations of the historical atmosphere.
Journal of Geophysical Research: Atmospheres, 2002
We use cointegration procedures that are designed to estimate and test relations among integrated... more We use cointegration procedures that are designed to estimate and test relations among integrated time series to develop a model of the relation between surface temperature and the radiative forcing of solar irradiance, greenhouse gases, and tropospheric sulfates. We use this model to test some basic hypotheses regarding the relation between surface temperature and radiative forcing. We find that there is a statistically meaningful relation between surface temperature and changes in the radiative forcing associated with natural variability and human activity. We also find that hemispheric temperatures cannot be explained by hemispheric forcings alone: Hemispheric temperatures are linked. Differences in hemispheric temperatures are associated with differences in the hemispheric temperature effects of greenhouse gases, anthropogenic sulfur emissions, and solar irradiance. Estimates for the temperature sensitivity (ΔT2x) are consistent with the middle and lower range of values estimate...
Global anthropogenic sulfur emissions increased until the late 1980s. Existing estimates for 1995... more Global anthropogenic sulfur emissions increased until the late 1980s. Existing estimates for 1995 and 2000 show a moderate decline from 1990 to 1995 or relative stability throughout the decade. This paper combines previously published data and new econometric estimates to show a 22% decline over the decade to a level not seen since the mid-1960s. The decline is evident in North America, Western and Eastern Europe, and in the last few years in East and South Asia. If this new trend is maintained, local air pollution problems will be ameliorated but global warming may be somewhat exacerbated.
We carry out a meta-analysis of the very large literature on testing for Granger causality betwee... more We carry out a meta-analysis of the very large literature on testing for Granger causality between energy use and economic output to determine if there is a genuine effect in this literature or whether the large number of apparently significant results is due to publication or misspecification bias. Our model extends the standard meta-regression model for detecting genuine effects in the presence of publication biases using the statistical power trace by controlling for the tendency to over-fit vector autoregression models in small samples. Granger causality tests in these over-fitted models have inflated type I errors. We cannot find a genuine causal effect in the literature as a whole. However, there is a robust genuine effect from output to energy use when energy prices are controlled for.
This article appeared in a journal published by Elsevier. The attached copy is furnished to the a... more This article appeared in a journal published by Elsevier. The attached copy is furnished to the author for internal non-commercial research and education use, including for instruction at the authors institution and sharing with colleagues. Other uses, including reproduction and distribution, or selling or licensing copies, or posting to personal, institutional or third party websites are prohibited. In most cases authors are permitted to post their version of the article (e.g. in Word or Tex form) to their personal website or institutional repository. Authors requiring further information regarding Elsevier's archiving and manuscript policies are
This paper extends my previous analysis of the causal relationship of GDP and energy use in the U... more This paper extends my previous analysis of the causal relationship of GDP and energy use in the USA in the postwar period. A majority of the relevant variables are integrated justifying a cointegration analysis. The results show that cointegration does occur and that energy input cannot be excluded from the cointegration space. The results are plausible in terms of macroeconomic dynamics. The results are similar to my previous Granger causality Ž. results and contradict claims in the literature based on bivariate models that there is no cointegration between energy and output.
Recent epidemics of Plasmodium falciparum malaria have been observed in high-altitude areas of Ea... more Recent epidemics of Plasmodium falciparum malaria have been observed in high-altitude areas of East Africa. Increased malaria incidence in these areas of unstable malaria transmission has been attributed to a variety of changes including global warming. To determine whether the reemergence of malaria in western Kenya could be attributed to changes in meteorologic conditions, we tested for trends in a continuous 30-year monthly malaria incidence dataset (1966-1995) obtained from complete hospital registers at a Kenyan tea plantation. Contemporary monthly meteorologic data (1966-1995) that originated from the tea estate meteorologic station and from global climatology records were also tested for trends. We found that total hospital admissions (malaria and nonmalaria) remained unchanged while malaria admissions increased significantly during the period. We also found that all meteorologic variables showed no trends for significance, even when combined into a monthly suitability index for malaria transmission. We conclude that climate changes have not caused the highland malaria resurgence in western Kenya.
Methods for investigating the role of energy in the economy involve aggregating different energy ... more Methods for investigating the role of energy in the economy involve aggregating different energy flows. A variety of methods have been proposed, but none has received universal acceptance. This paper shows that the method of aggregation has crucial effects on the results of the analysis. We review the principal assumptions and methods for aggregating energy flows: the basic heat equivalents approach, economic approaches using prices or marginal product for aggregation, emergy analysis, and thermodynamic approaches such as exergy. We argue that economic approaches such as the index or marginal product method are superior because they account for differences in quality among fuels. We apply various economic approaches in three case studies in the US economy. In the first, we account for energy quality to assess changes in the energy surplus delivered by the extraction of fossil fuels from 1954 to 1992. The second and third case studies examine the importance of energy quality in evaluating the relation between energy use and GDP. First, a quality-adjusted index of energy consumption is used in an econometric analysis of the causal relation between energy use and GDP from 1947 to 1996. Second, we account for energy quality in an econometric analysis of the factors that determine changes in the energy/GDP ratio from 1947 to 1996. Without adjusting for energy quality, the results imply that the energy surplus from petroleum extraction is increasing, that changes in GDP drive changes in energy use, and that GDP has been decoupled from between aggregate energy use. All of these conclusions are reversed when we account for changes in energy quality.
The ASL database provides continuous time-series of sulfur emissions for most countries in the Wo... more The ASL database provides continuous time-series of sulfur emissions for most countries in the World from 1850 to 1990, but academic and official estimates for the 1990s either do not cover all years or countries. This paper develops continuous time series of sulfur emissions by country for the period 1850-2000 with a particular focus on developments in the 1990s. Global estimates for 1996-2000 are the first that are based on actual observed data. Raw estimates are obtained in two ways. For countries and years with existing published data I compile and integrate that data. Previously published data covers the majority of emissions and almost all countries have published emissions for at least 1995. For the remaining countries and for missing years for countries with some published data, I interpolate or extrapolate estimates using either an econometric emissions frontier model, an environmental Kuznets curve model, or a simple extrapolation, depending on the availability of data. Finally, I discuss the main movements in global and regional emissions in the 1990s and earlier decades and compare the results to other studies. Global emissions peaked in 1989 and declined rapidly thereafter. The locus of emissions shifted towards East and South Asia, but even this region peaked in 1996. My estimates for the 1990s show a much more rapid decline than other global studies, reflecting the view that technological progress in reducing sulfur based pollution has been rapid and is beginning to diffuse worldwide.
We summarize what we know about energy and economic growth in a set of stylized facts. We combine... more We summarize what we know about energy and economic growth in a set of stylized facts. We combine analysis of a panel data set of 99 countries from 1971 to 2010 with analysis of some longer run historical data. Our key result is that over the last 40 years there has been a stable cross-sectional relationship between per capita energy use and income per capita with an elasticity of energy use with respect to income of less than unity. This implies that energy intensity has tended to decrease in countries that have become richer but not in others. We also find that over the last two centuries there has been convergence in energy intensity towards the current distribution, per capita energy use has tended to rise, energy quality to increase, and, though evidence is limited, the cost share of energy has declined.
This paper updates estimates of global anthropogenic sulfate emissions through 1993 and provides ... more This paper updates estimates of global anthropogenic sulfate emissions through 1993 and provides a time series of estimates for each year. We extend the methodology developed by Hameed and Dignon (1989) to include emissions from copper smelting and use estimates for US emissions between 1900 and 1940 which were not previously available. Emissions since 1986 show a slight rise due to an increase in the US followed by a slight decline and a continuing decline in emissions from the other OECD countries. Emissions from the rest of the world peak in 1989 and show a steep decline associated with recession and economic restructuring in Eastern Europe. The various emissions series are consistent with the historical record for the atmospheric concentration of non sea sulfates that is reconstructed from an ice core recovered from Greenland.
The issue of whether energy efficiency improvements will lower energy use or not is contentious. ... more The issue of whether energy efficiency improvements will lower energy use or not is contentious. We estimate the economy-wide rebound effect for Iran using a structural vector autoregressive model estimated with quarterly data from 1988:3 to 2018:1. The structural shocks are identified by independent component analysis, a statistical identification technique that does not require us to impose restrictions based on economic theory on the model. The results show that in response to an energy efficiency shock energy use falls initially, but returns to near its original level over time. The economy-wide rebound effect in Iran is 84% after 6 years and its confidence interval includes 100% implying that policies that encourage energy efficiency innovation will have limited longterm impact on energy use.
Improving energy efficiency is often considered to be one of the keys to reducing greenhouse gas ... more Improving energy efficiency is often considered to be one of the keys to reducing greenhouse gas emissions. However, efficiency gains also reduce the cost of energy services and may even reduce the price of energy, resulting in energy use rebounding and potential energy use savings being eaten up. There is only limited empirical research quantifying the economy-wide rebound effect that takes the dynamic economic responses to energy efficiency improvements into account. We use a Structural Factor-Augmented Vector Autoregressive model (S-FAVAR) that allows us to track how energy use changes in response to an energy efficiency improvement while accounting for a vast range of potential confounders. Our findings point to economy-wide rebound effects of 78% to 101% after two years in France, Germany, Italy, the U.K., and the U.S. These findings imply that energy efficiency innovations alone may be of limited help in reducing future energy use and emphasize the importance of tackling carbon emissions directly.
We review the literature on the economics of climate change with a focus on the evolution of the ... more We review the literature on the economics of climate change with a focus on the evolution of the literature from some of the early classic papers to the latest contributions. We divide the paper into three main sections: trends in greenhouse gas emissions, mitigation, and adaptation.
There has been extensive analysis of the drivers of carbon dioxide emissions from fossil fuel com... more There has been extensive analysis of the drivers of carbon dioxide emissions from fossil fuel combustion and cement production, which constituted only 55% of global greenhouse gas (GHG) emissions in 1970 and 65% in 2010. But there has been much less analysis of the drivers of greenhouse gases in general and especially of emissions of greenhouse gases from agriculture, forestry, and other land uses, which we call non-industrial emissions in this paper, that constituted 24% of total emissions in 2010. We statistically analyse the relationship between both industrial and non-industrial greenhouse gas emissions and economic growth and other potential drivers for 129 countries over the period from 1971 to 2010. Our analysis combines the three main approaches in the literature to investigating the evolution of emissions and income. We find that economic growth is a driver of both industrial and non-industrial emissions, though growth has twice the effect on industrial emissions. Both sources of emissions decline over time though this effect is larger for non-industrial emissions. There is also convergence in emissions intensity for both types of emissions but given these other effects there is no evidence for an environmental Kuznets curve.
Australian Journal of Agricultural and Resource Economics, 2003
The Environmental Kuznets Curve (EKC) hypothesis-an inverted U-shape relation between various ind... more The Environmental Kuznets Curve (EKC) hypothesis-an inverted U-shape relation between various indicators of environmental degradation and income per capitahas become one of the 'stylised facts' of environmental and resource economics. This is despite considerable criticism on both theoretical and empirical grounds. Cointegration analysis can be used to test the validity of such stylised facts when the data involved contain stochastic trends. In the present paper, we use cointegration analysis to test the EKC hypothesis using a panel dataset of sulfur emissions and GDP data for 74 countries over a span of 31 years. We find that the data is stochastically trending in the time-series dimension. Given this, and interpreting the EKC as a long run equilibrium relationship, support for the hypothesis requires that an appropriate model cointegrates and that sulfur emissions are a concave function of income. Individual and panel cointegration tests cast doubt on the general applicability of the hypothesised relationship. Even when we find cointegration, many of the relationships for individual countries are not concave. The results show that the EKC is a problematic concept, at least in the case of sulfur emissions. * The authors thank Peter Pedroni for providing econometrics code and comments on an earlier draft of the paper, and Chihwa Kao and Yongcheol Shin for providing Gauss code. We also thank Mick Common, Yongcheol Shin, and Quentin Grafton and two anonymous referees for useful comments. Kali Sanyal assembled the dataset.
Analysis of observational temperature records for the Northern and Southern hemispheres indicates... more Analysis of observational temperature records for the Northern and Southern hemispheres indicates a statistical relationship in which Northern Hemisphere temperature depends on temperature in the Southern Hemisphere. This pattern, which has strengthened over time, can be explained by the climatic effects of anthropogenic trace gases and tropospheric sulphate aerosols. A similar statistical pattern is produced by model simulations of the historical atmosphere.
Journal of Geophysical Research: Atmospheres, 2002
We use cointegration procedures that are designed to estimate and test relations among integrated... more We use cointegration procedures that are designed to estimate and test relations among integrated time series to develop a model of the relation between surface temperature and the radiative forcing of solar irradiance, greenhouse gases, and tropospheric sulfates. We use this model to test some basic hypotheses regarding the relation between surface temperature and radiative forcing. We find that there is a statistically meaningful relation between surface temperature and changes in the radiative forcing associated with natural variability and human activity. We also find that hemispheric temperatures cannot be explained by hemispheric forcings alone: Hemispheric temperatures are linked. Differences in hemispheric temperatures are associated with differences in the hemispheric temperature effects of greenhouse gases, anthropogenic sulfur emissions, and solar irradiance. Estimates for the temperature sensitivity (ΔT2x) are consistent with the middle and lower range of values estimate...
Global anthropogenic sulfur emissions increased until the late 1980s. Existing estimates for 1995... more Global anthropogenic sulfur emissions increased until the late 1980s. Existing estimates for 1995 and 2000 show a moderate decline from 1990 to 1995 or relative stability throughout the decade. This paper combines previously published data and new econometric estimates to show a 22% decline over the decade to a level not seen since the mid-1960s. The decline is evident in North America, Western and Eastern Europe, and in the last few years in East and South Asia. If this new trend is maintained, local air pollution problems will be ameliorated but global warming may be somewhat exacerbated.
We carry out a meta-analysis of the very large literature on testing for Granger causality betwee... more We carry out a meta-analysis of the very large literature on testing for Granger causality between energy use and economic output to determine if there is a genuine effect in this literature or whether the large number of apparently significant results is due to publication or misspecification bias. Our model extends the standard meta-regression model for detecting genuine effects in the presence of publication biases using the statistical power trace by controlling for the tendency to over-fit vector autoregression models in small samples. Granger causality tests in these over-fitted models have inflated type I errors. We cannot find a genuine causal effect in the literature as a whole. However, there is a robust genuine effect from output to energy use when energy prices are controlled for.
This article appeared in a journal published by Elsevier. The attached copy is furnished to the a... more This article appeared in a journal published by Elsevier. The attached copy is furnished to the author for internal non-commercial research and education use, including for instruction at the authors institution and sharing with colleagues. Other uses, including reproduction and distribution, or selling or licensing copies, or posting to personal, institutional or third party websites are prohibited. In most cases authors are permitted to post their version of the article (e.g. in Word or Tex form) to their personal website or institutional repository. Authors requiring further information regarding Elsevier's archiving and manuscript policies are
This paper extends my previous analysis of the causal relationship of GDP and energy use in the U... more This paper extends my previous analysis of the causal relationship of GDP and energy use in the USA in the postwar period. A majority of the relevant variables are integrated justifying a cointegration analysis. The results show that cointegration does occur and that energy input cannot be excluded from the cointegration space. The results are plausible in terms of macroeconomic dynamics. The results are similar to my previous Granger causality Ž. results and contradict claims in the literature based on bivariate models that there is no cointegration between energy and output.
Recent epidemics of Plasmodium falciparum malaria have been observed in high-altitude areas of Ea... more Recent epidemics of Plasmodium falciparum malaria have been observed in high-altitude areas of East Africa. Increased malaria incidence in these areas of unstable malaria transmission has been attributed to a variety of changes including global warming. To determine whether the reemergence of malaria in western Kenya could be attributed to changes in meteorologic conditions, we tested for trends in a continuous 30-year monthly malaria incidence dataset (1966-1995) obtained from complete hospital registers at a Kenyan tea plantation. Contemporary monthly meteorologic data (1966-1995) that originated from the tea estate meteorologic station and from global climatology records were also tested for trends. We found that total hospital admissions (malaria and nonmalaria) remained unchanged while malaria admissions increased significantly during the period. We also found that all meteorologic variables showed no trends for significance, even when combined into a monthly suitability index for malaria transmission. We conclude that climate changes have not caused the highland malaria resurgence in western Kenya.
Methods for investigating the role of energy in the economy involve aggregating different energy ... more Methods for investigating the role of energy in the economy involve aggregating different energy flows. A variety of methods have been proposed, but none has received universal acceptance. This paper shows that the method of aggregation has crucial effects on the results of the analysis. We review the principal assumptions and methods for aggregating energy flows: the basic heat equivalents approach, economic approaches using prices or marginal product for aggregation, emergy analysis, and thermodynamic approaches such as exergy. We argue that economic approaches such as the index or marginal product method are superior because they account for differences in quality among fuels. We apply various economic approaches in three case studies in the US economy. In the first, we account for energy quality to assess changes in the energy surplus delivered by the extraction of fossil fuels from 1954 to 1992. The second and third case studies examine the importance of energy quality in evaluating the relation between energy use and GDP. First, a quality-adjusted index of energy consumption is used in an econometric analysis of the causal relation between energy use and GDP from 1947 to 1996. Second, we account for energy quality in an econometric analysis of the factors that determine changes in the energy/GDP ratio from 1947 to 1996. Without adjusting for energy quality, the results imply that the energy surplus from petroleum extraction is increasing, that changes in GDP drive changes in energy use, and that GDP has been decoupled from between aggregate energy use. All of these conclusions are reversed when we account for changes in energy quality.
The ASL database provides continuous time-series of sulfur emissions for most countries in the Wo... more The ASL database provides continuous time-series of sulfur emissions for most countries in the World from 1850 to 1990, but academic and official estimates for the 1990s either do not cover all years or countries. This paper develops continuous time series of sulfur emissions by country for the period 1850-2000 with a particular focus on developments in the 1990s. Global estimates for 1996-2000 are the first that are based on actual observed data. Raw estimates are obtained in two ways. For countries and years with existing published data I compile and integrate that data. Previously published data covers the majority of emissions and almost all countries have published emissions for at least 1995. For the remaining countries and for missing years for countries with some published data, I interpolate or extrapolate estimates using either an econometric emissions frontier model, an environmental Kuznets curve model, or a simple extrapolation, depending on the availability of data. Finally, I discuss the main movements in global and regional emissions in the 1990s and earlier decades and compare the results to other studies. Global emissions peaked in 1989 and declined rapidly thereafter. The locus of emissions shifted towards East and South Asia, but even this region peaked in 1996. My estimates for the 1990s show a much more rapid decline than other global studies, reflecting the view that technological progress in reducing sulfur based pollution has been rapid and is beginning to diffuse worldwide.
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