Regional productivity in the transformation of China’s energy structure –estimation of the restricted cost function

Abstract

ABSTRACT In this study, energy structure is introduced into the restricted cost function to study the influence of energy structure transformation (EST) on regional productivity. The analysis indicates that: (i) the average annual productivity of various regions in China has a positive growth, with an average annual growth rate of 6.97% and a downward growth trend from 12.15% to 4.13%. Technological progress has the greatest positive contribution to productivity growth, while energy structure and scale effect have slight negative effects. (ii) Further regional empirical analysis reveals a gradient distributions of eastern > central > western area for productivity growth. Although the effect of technological progress in western area is greater than that of eastern and central areas, low energy efficiency has dragged down its productivity growth. (iii) Factor input bias analysis demonstrates that technological progress tends to factor saving, while energy structure adjustment tends to a slight factor using with different preferences in regions. Inspired by the empirical results, strategies for optimizing policies and regional collaboration are proposed from a systematic perspective.