Technological progress and metal resource consumption in the electricity industry—A cross-country panel threshold data analysis

Abstract

This paper introduces a dynamic panel threshold model to empirically investigate whether the effects of technological progress on metal consumption in the electricity industry differs by the change of industrial structure upgrading level (INSTRU). We consider a panel data set including 41 countries over the period 2000–2016. The estimated results suggests 2.72, 2.39 and 2.84 as the average threshold parameters of INSTRU for basic ferrous metals (Iron and Chromium), basic non-ferrous metals (Aluminium, Copper and Nickel) and critical metals (Indium, Neodymium and Dysprosium) respectively. When INSTRU is lower than the corresponding threshold, domestic technological progress (LnSRD) and foreign technological spillover progress (LnSIM) significantly promote the consumption of the above-mentioned metals. However, when INSTRU is higher than the corresponding threshold, LnSRD and LnSRD will reduce the consumption of basic ferrous metals such as Iron and Chromium, but will continue to increase the consumption of critical metals such as Indium, Neodymium and Dysprosium. Last, we confirm that LnSRD play a more important role in changing metal consumption structure in the electricity industry than that of LnSIM. These findings are of great significance to government policies that ensure the transition to low-carbon electricity systems.