What drives energy intensity fall in China? Evidence from a meta-frontier approach

Abstract

This paper proposed a novel meta-frontier multi-tier approach which can reveal the impacts of industrial structure reorganization, regional equilibrium development, and management efficiency on energy intensity change. China’s energy intensity was used to demonstrate the proposed approach. Based on the empirical results, this study found that during 2000–2016, China’s energy intensity witnessed a considerable decline. Potential energy intensity change and technological progress were the dominant contributors responsible for lowering energy intensity. In addition to conventional factors, the new provided six factors also have important impacts on energy intensity during the study years. First, the output-oriented industrial technological gap facilitated to lower energy intensity, while the energy-oriented industrial technological gap slightly impeded energy intensity decline. Second, the regional technological gap impeded energy intensity decline, indicating that China’s efforts of regional equilibrium development failed to narrow the energy-saving technology gap between regions. Third, energy-oriented pure technical efficiency decreased energy intensity, while output-oriented pure technical efficiency increased energy intensity. It implies that management efficiency in energy market was optimized, however, there exist management inefficiency in output market. Over multiple spatial scales, the performances of different factors were distinctly various, local governments should establish and implement policies tailored to their characteristics.