Abstract
Residual problems are one of the greatest challenges in developing new decomposition techniques, especially when combined with the Cobb–Douglas (C-D) production function and the Logarithmic Mean Divisia Index (LMDI) method. Although this combination technique can quantify more effects than LMDI alone, its decomposition result has residual value. We propose a new approach that can achieve non-residual decomposition by calculating the actual values of three key parameters. To test the proposed approach, we decomposed the carbon emissions in the United States to six driving factors: the labor input effect, the investment effect, the carbon coefficient effect, the energy structure effect, the energy intensity effect, and the technology state effect. The results illustrate that the sum of these factors is equivalent to the CO2 emissions changes from t to t-1, thereby proving non-residual decomposition. Given that the proposed approach can achieve perfect decomposition, the proposed approach can be used more widely to investigate the effects of labor input, investment, and technology state on changes in energy and emission.
Highlights
When exploring the factors affecting energy consumption or carbon emissions, it is the pursuit of more scholars to decompose more factors
Dong et al [2] confessed that the combination technique could not implement complete decomposition, but was still applied, because this technique was able to quantify the effects of labor force input and fixed asset investment on changes in carbon emissions
Xu and Ang reviewed and summarized 80 papers that applied the index decomposition analysis (IDA) method on emission studies during 1991 to 2012, and the results revealed that IDA is more widely used than structural decomposition analysis (SDA) when decomposed CO2 emissions change [17]; and they employed the IDA method to decompose the residential energy consumption in Singapore [18]
Summary
When exploring the factors affecting energy consumption or carbon emissions, it is the pursuit of more scholars to decompose more factors. To quantify the effects of fixed asset investment and labor input on changes in energy consumption and carbon emissions, Wang et al [1] combined the Cobb–Douglas (C-D) production function and the Logarithmic Mean Divisia Index (LMDI) econometric method. This combined technique can quantify more effects than can LMDI alone. Guided by applied intermediate macroeconomics [3], this paper reports a new approach to solving the zero-value problem and exploring one more factor, which is the technology state factor In this way, the combined decomposition technique can be better used in studying the effects of fixed asset investment, labor force input and technology state on energy consumption changes and carbon emissions changes
Sign-in/Register to view highlights & summary Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
