factor demand technical change and inter fuel substitution in africa abstract the translog production function has been widely used in applied production analysis due to its flexibility and superiority over other functional forms this study develops a translog production function for a group of african countries the random effects model is estimated using generalized least squares estimator the main findings are first output in africa is driven by a more intensive use of petroleum and electricity and to a lesser extent capital labor and coal relative to technological progress second african production technology exhibits increasing returns to scale suggesting a path towards market entry barriers third technical change is scale biased and factor augmenting albeit very slow fourth all energy inputs are substitutes indicating africa s potential to proportionally switch towards cleaner fuels without adversely affecting economic growth finally and perhaps more generally the study reinforces the assertion that imposing restrictions like homotheticity homogeneity or separability on the production technology is unrealistic and should rather be a testable hypothesis within any applied analysis in view of the documented findings relevant implications for africa are discussed

wheat from chaff meta analysis as quantitative literature review abstract this paper presents and develops a quantitative method of literature reviewing and evaluating empirical research meta regression analysis or mra economics is theory driven yet we must learn empirically if economics is to advance mra offers a more objective statistical method to summarize our empirical knowledge and to explain the wide study to study variation in economic research mra is used to assess the evidence for ricardian equivalence and its findings are contrasted to those of conventional narrative review furthermore mra establishes a platform from which to distinguish genuine empirical effect from the exploitable specification error that infests applied econometrics

brazilian energy efficiency and energy substitution a road to cleaner national energy system abstract recognizing the need to increase energy efficiency across various sectors of the economy the brazilian government through the national energy efficiency plan adopted in 2011 seeks to avoid 30 million tons of co2 emissions through a reduction in electricity consumption of about 10 by 2030 notwithstanding we believe that a complete realization of such initiative will be dependent on the level of substitutability between different production factors and fuel types using the translog production function method this paper first provides insight on the economic impact of both factor and fuel inputs in brazil most importantly we examine the possibility of substitution among capital labor petroleum and electricity the ridge regression technique was used to estimate the parameters after our data depicted the existence of multicollinearity our results show that capital and labor are positively linked to output however petroleum and electricity contribute negatively to economic output in brazil of which corruption is a plausible reason again all variable inputs are substitutes with their relative technological progress depicting features of convergence this implies that brazil can achieve a cleaner energy system without much challenges due to the possibility of switching from greenhouse gas ghg emitting petroleum to a cleaner energy electricity our findings also highlight the importance of policies that advance merger of enterprises and renewable energy use

semi nonparametric estimates of interfuel substitution in u s energy demand abstract this paper focuses on the demand for crude oil natural gas and coal in the united states in the context of two globally flexible functional forms the fourier and the asymptotically ideal model aim estimated subject to full regularity using methods suggested over 20 years ago by gallant and golub gallant a ronald and golub gene h imposing curvature restrictions on flexible functional forms journal of econometrics 26 1984 295 321 and recently used by serletis and shahmoradi serletis a shahmoradi a 2005 semi nonparametric estimates of the demand for money in the united states macroeconomic dynamics 9 542 559 in the monetary demand systems literature we provide a comparison in terms of a full set of elasticities and also a policy perspective using for the first time parameter estimates that are consistent with global regularity

allocative inefficiency and the capital energy controversy abstract the purpose of the paper is to estimate a system of input demands for greek manufacturing deviating from the standard practice of assuming strict cost minimization the study allows for the presence of price distortions and allocative inefficiency in the decision process this assumption affects parameter estimates and estimated elasticities materially and throws new light on the capital energy controversy in greek manufacturing

energy consumption and economic growth in south africa reexamined a nonparametric testing apporach this paper is an effort to investigate claims concerning granger causality relationship from energy consumption to economic growth in south africa we adopt a nonparametric bootstrap method to reassess evidence supporting granger causality and unravel findings of long run unidirectional causality running from energy consumption to economic growth this implies that energy conservation policies will negatively impact economic growth in south africa in addition the results of this study have implications on co2 emissions in south africa given that coal accounts for about 72 of energy this suggests that energy use would have a long run effect of raising the country s co2 emission levels hence there might be a need to develop a more balanced energy structure which will include higher share of renewable energy a further monte carlo experiment performed reveals that asymptotic granger causality test suffers size distortion problem for south african data these findings provide support for use of a bootstrap methodology and also imply that the results presented in this study are likely to be more reliable

energy substitution effect on transport sector of pakistan a trans log production function approach abstract transport sector of pakistan is one of the highest fossil fuel consumption and carbon dioxide co2 emission sector as a key user of fossil fuel energy pakistan s transport sector has created many problems i e noise air pollution co2 emissions and environmental problem in this study trans log production function model for pakistan s transport sector is established and input factors of labor capital and energy consumption are comprised the output elasticity of an individual input elasticity between a pair of factors and elasticity of substitution between input factors are analyzed to manage the multicollinearity issue ridge regression is applied at different values of k from 1991 to 2018 the outcomes show that output elasticities and a pair of input factor s elasticities are increasing the elasticities of substitutions between labor energy consumption and capital energy consumption show higher outcomes because of the more elevated amount of substitution elasticities the substitution elasticity between labor and capital starts from 0 9797 to 0 9326 with slightly decreasing trend the outcomes suggest that maximum output can be achieved by increasing capital and energy technologies by allocating the maximum capital in the transport industry energy saving technologies substitution between energy and capital and substitution among capital labor can enhance environmental protection in the above s view function the present study estimates the level of energy saving and co2 emissions reduction under the different scenarios from 2015 to 2018 the policy suggestions of the results are given below

is renewable energy a model for powering eastern african countries transition to industrialization and urbanization abstract this study profiles a conversation on the appropriateness of renewable energy as a model for powering development in east african countries estimated output elasticities of nonrenewable energy 0 29 0 48 are by far larger than those of renewable energy 0 12 0 08 and as such highlights the relative importance of the former also the biased component of technical change shows higher technological progress for nonrenewable energy furthermore substitution elasticities are positive 0 77 0 92 suggesting huge potential for a transition towards renewable energy however inherent limitations in renewables documented in wesseh and lin 52 53 undermine the usefulness of east african countries reliance on renewable energy

separability functional form and regulatory policy in models of interfuel substitution abstract counter intuitive results such as positive own price elasticities have been found in some studies of interfuel substitution this paper examines three possible reasons for this problem first including energy materials in petroleum and coal aggregates is found to contribute to incorrect signs second the mathematical properties of the translog function contribute to concavity violations in contrast the linear logit model of cost shares is found to provide more sensible estimates of own price elasticities across alternative model specifications finally natural gas curtailment policies and environmental regulations are found to be significant factors influencing us industrial fuel demand although omission of these factors does not directly contribute to curvature violations

inter factor inter fuel substitution carbon intensity and energy related co2 reduction empirical evidence from china carbon dioxide co2 reduction which is the central issue in addressing global warming depends on the extent that clean energy can substitute for co2 emitting coal and non energy factors can substitute for energy factor the purposes of this paper are to empirically investigate inter factor inter fuel substitution in china and to evaluate the determinants of china s energy related carbon intensity as well as mitigation effects of carbon tax considering china s rapid increase in energy consumption and the slow adjustment in substitution the two stage estimation method and the dynamic error correction mechanism are employed in this study the empirical results suggest substitutability among different types of energy sources as well as substitutability among energy labor and capital the magnitude of cross price elasticities indicates that the substitutions are inelastic which limits the scope of the chinese government to implement substitution strategy aiming at energy conservation and environmental management china s carbon intensity declined during 1985 2012 most of which can be attributed to labor substitution and energy price increase however carbon intensive technology being embodied in china s capital investment energy consuming equipment has contributed to the increase in carbon intensity a carbon tax of rmb 50 tonne could reduce 332 9 million tonnes co2 emissions on the basis of 2012 in addition if ignoring the feedback between inter factor inter fuel substitutions co2 mitigation potential would be underestimated

estimates of inter fuel substitution possibilities in chinese chemical industry abstract the chemical sector is a key driver of china s remarkable growth record and accounts for about 10 of the country s gdp this has made the industry energy intensive and consequently a major contributor to greenhouse gas emissions ghg and other pollutants this study has attempted to investigate the potential for inter fuel substitution between coal oil natural gas and electricity in chinese chemical sector by employing a translog production and cost function ridge regression procedure was adopted to estimate the parameters of the function estimation results show that all energy inputs are substitutes in addition the study produces evidence that the significant role of coal in the chinese chemical fuel mix converges over time albeit slowly these results suggest that price based policies coupled with capital subsidy programs can be adopted to redirect technology use towards cleaner energy sources like electricity and natural gas hence retaining the ability to fuel the chemical sector while also mitigating ghg emissions notwithstanding one must understand that the extent to which substituting electricity for coal will be effective depends on the extent to which coal or oil is used in generating electricity the findings of this study provide general insights and underscore the importance of chinese government policies that focus on installed capacity of renewable electricity energy intensity targets as well as merger of enterprises

inflation and welfare in a monetary economy it is in everyone s private interest to try to get someone else to hold non interest bearing cash and reserves but someone has to hold it all so these efforts must simply cancel out all of us spend several hours per year in this effort and employ thousands of talented and highly trained people to help us these person hours are simply thrown away wasted on a task that should not have to be performed at all

the determinants of aggregate energy use in west germany factor substitution technological change and trade this paper examines the determinants of production related energy use in west germany over the period 1976 1994 the approach is to estimate a system of share equations for energy capital low skilled labor high skilled labor and materials in the west german production sector taking account of biased technological change and increasing trade orientation while technological change is found to be energy saving increased openness is energy using i e tends to increase the energy share factor substitution biased technological change and trade contribute to the year to year volatility of energy intensity in the proportion 66 30 4 the results are robust across several specifications examined

satisfying the rural residential demand in liberia with decentralized renewable energy schemes abstract with the lowest access to electricity in the world the country of liberia west africa has efforts underway for electrification through a fossil based centralized scheme around its capital city and possible connections to the larger western africa power pool network these plans leave a large part of the rural population with no access to electricity this work analyzes the potential of decentralized generation to provide electricity to the rural liberian population the suppressed demand of the rural population is calculated at 235 gwh yr there is sufficient renewable energy potential to supply this demand the capital costs and electricity prices of decentralized generation with different fuels are calculated and compared to the ability and willingness to pay of rural liberians small diesel units have the lowest capital cost but photovoltaic small hydropower and small biomass projects provide lower electricity prices biomass and small hydro electricity are affordable for liberians at 0 08 kwh and 0 11 kwh respectively diesel and photovoltaic with levelized cost of electricity of 0 62 kwh and 0 33 kwh respectively exceed liberians willingness to pay centralized and decentralized electricity developments are not mutually exclusive both may be used within a comprehensive electrification plan decentralized generation with emphasis on rural areas can complement the existing plans to achieve the government of liberia s goal of universal access to electricity providing social equity and economic progress in order to become a reality rural decentralized electrification will need policy support and focused funding

causal independence between energy consumption and economic growth in liberia evidence from a non parametric bootstrapped causality test abstract this contribution investigates causal interdependence between energy consumption and economic growth in liberia and proposes application of a bootstrap methodology to better reflect causality employment is incorporated as additional variable the study demonstrates evidence of distinct bidirectional granger causality between energy consumption and economic growth additionally the results show that employment in liberia granger causes economic growth and apply irrespective of the short run or long run evidence from a monte carlo experiment reveals that the asymptotic granger causality test suffers size distortion problem for liberian data suggesting that the bootstrap technique employed in this study is more appropriate given the empirical results implications are that energy expansion policies like energy subsidy or low energy tariff for instance would be necessary to cope with demand exerted as a result of economic growth in liberia furthermore liberia might have the performance of its employment generation on the economy partly determined by adequate energy therefore it seems fully justified that a quick shift towards energy production based on clean energy sources may significantly slow down economic growth in liberia hence the government s target to implement a long term strategy to make liberia a carbon neutral country and eventually less carbon dependent by 2050 is understandable

energy consumption fuel substitution technical change and economic growth implications for co2 mitigation in egypt abstract energy consumption propels economic growth but the level of co2 emissions associated with a fossil dominated energy structure raises concerns for the fight against climate change to draw consensus this study develops a translog causality based model in order to study causation between electricity natural gas petroleum and economic growth in egypt in addition the models results are used to estimate the substitution possibilities between various energy pairs and to subsequently test the co2 mitigation benefits arising from fuel substitution results support a bidirectional relationship between all energy types and economic growth in egypt and suggest also that these energy types are substitutes although technical progress is estimated to be a bit slow varying between 4 5 and 7 5 there appears to be substantial co2 emissions mitigation benefits from fuel substitution amounting to reductions in the range of 1 5 and 2 2 million metric tons under a 5 investment scenario and 2 5 and 4 5 million metric tons under a 10 investment scenario these results have broader implications for energy conservation policies and industrial merger policies in developing countries moreover by studying technical change insights are provided on future co2 mitigation potential driven by energy efficiency

economic growth and interfactor interfuel substitution in korea this paper investigates the impact of increases in oil consumption and changes in wage rates on the interfactor interfuel substitution in korea a two stage translog cost function is estimated to incorporate the feedback effect between the interfactor and interfuel substitution empirical results show that the substitutability complementarity relationships among factors and fuels exhibit substantially different patterns before and after 1989

a real options valuation of chinese wind energy technologies for power generation do benefits from the feed in tariffs outweigh costs abstract in order to assess the viability of wind energy projects in china this paper takes a real options approach by accounting for flexibility over deployment of the technology in response to a stochastic non renewable energy cost the difference between the latter and the r d enhanced cost of renewable energy operation may be thought of as a benefit from using wind on the other hand the chinese government provides feed in tariffs to encourage further adoption of wind which should be included as a cost this work thus shows that there is substantial options value to china s wind energy program which is bolstered if the cost of carbon dioxide emissions is internalized moreover by varying the rate of feed in tariffs the model may be used to show plausible ranges for the feed in tariffs which could be a useful policy insight furthermore the study hypothesizes that with the likelihood of renewable energy to replace non renewable energy wind power in china can potentially reduce co2 emissions by approximately 6 4 by 2020 comparing to the 2005 level and highlights the significant role of wind power in china s emission targets and energy security this is a relevant paper especially given the importance of a sustainable energy transition for china more generally using the real options approach from a policy perspective could provide insights about the viability of renewable energy programs and robustness of feed in tariffs rates

ghanaian energy economy inter production factors and energy substitution abstract industries in ghana depend highly on petroleum to fuel their operations which has brought immerse environmental threat from greenhouse emission gas ghg this study tried to investigate potential substitutability of factor inputs and fuel inputs among capital labor petroleum and electricity in ghana by adopting the translog production and cost function approach we used ridge regression technique to estimate the parameters after our data show possibility of multicollinearity our result shows that all inputs are substitutes with their relative technological progress also showing evidence of convergence this suggests that redirecting resources into the improvement of technology towards cleaner energy production like electricity will be a success over time and this will mean that the fueling of the economy will be done in a cleaner environment and mitigating mitigate co2 emissions as well the improvement of electricity production and the promotion of its use require government policies that will enable industries to adjust to the switch from one input to the other through capital subsidies and tax rebates also energy labor and capital energy being substitutes in our findings suggest that removal of all energy subsidies will reduce the use of energy and increase capital and labor intensiveness input switch by industries will promote merger of smaller firms with bigger firms that have cost advantage during the switch period and requires a clear government merger control policies in a nutshell our findings provide an insight into policies to promote the use of renewable energy energy intensity and merger policies

equilibrium in competitive insurance markets with ex ante adverse selection and ex post moral hazard abstract existence of pure strategy equilibria is studied in health insurance markets that exhibit both ex ante adverse selection of the rothschild stiglitz wilson type and ex post hidden information moral hazard it is found that ex post moral hazard has two offsetting effects on the existence of equilibrium and that in general it is difficult to say whether an equilibrium is more or less likely to exist numerical simulations and an analytical example confirm that moral hazard may increase the likelihood of equilibrium these results are interpreted as evidence that health maintenance organization hmo markets could be less likely to exhibit stable equilibria than are fee for service insurance markets

refined oil import subsidies removal in ghana a triple win abstract in this study claims and counterclaims that fossil fuel subsidies removal yields benefits in terms of budget deficits energy efficiency and mitigation are assessed in order to do this a global computable general equilibrium cge model has been estimated to evaluate the impact of subsidies removal on imported refined oil in ghana on prices carbon dioxide co 2 emissions households demand firm s production and real gdp the simulation experiment points to evidence that subsidy removal raises prices increases the rate of co 2 emissions reduces households demand reduces aggregate output and affects various sectors differently the increased rate of co 2 emissions due to the removal of subsidies is indicative of the existence of the so called green paradox these results underscore the fact that a removal of subsidies on fossil fuels may win in some regards but fail in others a general implication from the applied model therefore is one which supports the assertion that removal of subsidies on fossil fuels removal on energy should be implemented along with policies aimed at stimulating economic activities and reducing the level of co 2 emissions especially where there is evidence of the green paradox

addressing the competitiveness effects of taxing carbon in china domestic tax cuts versus border tax adjustments abstract this study focuses on the international competitiveness effects of levying a carbon tax in china based on a computable general equilibrium model this study analysed the impacts of a carbon tax on different sectors from the aspect of changes in market shares of domestic producers in the domestic markets and changes in exports the effects of different measures including domestic tax cuts and border tax adjustments in alleviating the unfavourable competitiveness impacts were also analysed and compared as were the impacts of different tax schemes on the macro economy sectoral profits and carbon emissions the results show that without any complementary measures a carbon tax would negatively shock the domestic market shares and exports of almost all tradable sectors and the profits of almost all sectors as for cushioning the unfavourable effects the domestic tax cuts are able to ease the negative impacts on the domestic market shares and exports of almost all tradable sectors moreover the unfavourable impacts of domestic tax cuts on both the macro economy and the sectoral profits are obviously smaller than those of the other schemes regardless of the use of the same tax rate or emission reduction amount among the border tax adjustment measures the best performance in general corresponds to the measure purely implementing adjustments on exports

energy substitution efficiency and the effects of carbon taxation evidence from china s building construction industry as buildings are constructed to be more energy efficient and environmental friendly the building construction industry which is a basic and leading industry of the national economy development has become one of the key sectors for energy conservation and emission reduction in china this paper aims at quantifying both inter factor and inter energy substitution for china s building construction industry and investigate the main driving forces behind energy efficiency changes as well as the co2 abatement effect of a uniform carbon tax in this sector the model is established employing provincial pooled data over 2003 2012 in china by regions hence results between different regions are compared the main findings indicate that i energy and non energy are substitutes whereas individual energy inputs are complementary in china s building construction industry the substitution effect varies across regions due to different factor endowments and marketization levels ii energy price increase and construction scale expansion leads to energy efficiency improvement while substitution and technology present negative influences on energy efficiency iii approximately 3 of the co2 emissions in china s building construction industry can be reduced by carbon taxation based on the integrated own and cross price elasticities of each energy

a dynamic analysis of interfuel substitution in u s industrial energy demand using data for 1960 92 to analyze interfuel substitution in the u s industrial sector a dynamic linear logit model is shown to provide superior global properties than a comparable dynamic translog model confirming earlier static results by t j considine 1989 the linear logit model provides a direct unbiased estimate of the rate of dynamic adjustment indicating a median response lag of less than two years excluding fuels used for nonenergy purposes yields larger estimates of the price elasticities for coal and oil and indicates generally greater potential for interfuel substitution than when using aggregate data

an empirical study of direct rebound effect for passenger transport in urban china transport sector accounts for about 8 of total energy consumption in china and this share will likely increase in the visible future improving energy efficiency has been considered as a major way for reducing transport energy use whereas its effectiveness might be affected by the rebound effect this paper estimates the direct rebound effect for passenger transport in urban china by using the linear approximation of the almost ideal demand system model and simulation analysis our empirical results reveal the existence of direct rebound effect for passenger transport in urban china a majority of the expected reduction in transport energy consumption from efficiency improvement could be offset due to the existence of rebound effect we have further investigated the relationship between the magnitude of direct rebound effect and households expenditure it was found that the direct rebound effect for passenger transport tends to decline with the increase of per capita household consumption expenditure

impacts of shifting china s final energy consumption to electricity on co2 emission reduction abstract electrification is advocated by both academics and the chinese government to control air pollution and promote productivity however the problem remains to be solved of how to achieve the trade off between reducing co 2 emissions and maintaining economic growth when switching from various fuels to electricity under the policy support in view of this after analyzing the effects of exogenous shocks in various fuel demands based on impulse response functions of several vector autoregression models this paper measures the current and long term impacts of electrification on gdp and co 2 emissions finally some typical cases of replacement of fossil fueled appliances by electrical counterparts encouraged by the government are assessed the main findings are 1 almost all of the exogenous shocks in fuel demands have positive effects on both gdp and co 2 emissions while the gas shock has a slightly negative effect on gdp 2 carbon intensity decreases and even co 2 emission reductions with increased gdp are potentially achieved in both current and permanent periods for coal electricity and oil electricity switching while gas electricity switching is not a wise choice in view of co 2 emission reduction in the long run 3 the alternative electric appliances for electrification have very different impacts on co 2 emission reduction

three decades of money demand studies differences and similarities by analysing almost 1000 money demand estimations this paper attempts to summarize the diverse findings of the literature on this topic using both descriptive statistics and meta regressions several stylized facts are derived about the two most prominent determinants of money demand income and interest rate elasticities in particular it is shown we show that the size and signs of average elasticities are systematically related to the choice of included variables e g m1 or m3 short run or long run interest rates the country grouping e g usa versus germany and the empirical specification e g the inclusion of one or two interest rates

substitution possibilities and determinants of energy intensity for china abstract this paper measures technological change factor demand and inter factor and inter fuel substitutability measures for china we use individual fuel price data and a two stage approach to estimate total factor cost functions and fuel share equations both inter factor and inter fuel substitution elasticities are calculated and the change in energy intensity is decomposed into its driving forces the results suggest that energy is substitutable for capital regionally and for labor nationally capital substitutes for energy more easily than labor does energy intensity changes vary by region but the major drivers seem to be budget effect and the adoption of energy intensive technologies which might be embodied in high level energy using exports and sectors capital investment and even old technique and equipment imports whether the trend in rising energy intensity continues will be significant for china and the rest of the world

the effect of carbon tax on per capita co2 emissions new huadu business school 09zd050 national social science foundation of china 09zd050 08ajy022 research foundation of ministry of education of china 10jzd0018 fundamental research funds for the central universities 2010221051

money demand and disinflation in selected ceecs during the accession to the eu a panel data set for six countries czech republic hungary poland romania slovakia and slovenia is used to estimate money demand with panel cointegration methods over the recent disinflation period the basic money demand model is able to convincingly explain the long run dynamics of m2 in the selected countries however money demand is found to have been significantly determined by the euro area interest rates and the exchange rate against the euro which indicates possible instability of money demand functions in the central and eastern european countries therefore direct inflation targeting is an appropriate monetary regime before the eventual adoption of the euro

another look at long run money demand abstract this paper investigates the long run demand for m1 in the postwar united states previous studies based on data ending in the late 1980s are inconclusive about the parameters of postwar money demand this paper obtains precise estimates of these parameters by extending the data through 1996 the income elasticity of money demand is approximately 0 5 and the interest semi elasticity is approximately 0 05 these parameters are significantly smaller in absolute value than the corresponding parameters for the prewar period a caveat is that the analysis assumes there is no trend in money demand resulting from technological change

a carbon tax to reduce co2 emissions in europe abstract this paper examines the effects of introducing a tax on carbon dioxide emissions produced by combustion processes in oecd european countries a sectoral model of energy consumption is constructed to examine energy saving and inter fuel substitution effects induced by the introduction of various carbon taxes the simulation period is 1989 1994 our results provide a mild support to the environmental role of a carbon tax energy saving or inter fuel substitution processes that result from the introduction of environmental taxation stabilize emissions at the 1988 level only in the electricity generation sector and only if high tax rates are assumed 100 ton c by contrast total emissions all sectors and all fuels keep growing and the implementation of a tax of 100 ton c can only reduce the emission growth rate these results would recommend the introduction of several coordinated environmental instruments the last part of the paper compares results concerning oecd europe with those obtained when examining a single country italy the comparison does not seem to be in favour of a uniform carbon tax it rather indicates that environmental policy should be designed taking into account the specific economic situation and technological choices of each single country country specific coordinated environmental policies are to be recommended where international coordination ought to concern environmental targets rather than instruments

the rebound effect for heavy industry empirical evidence from china abstract energy efficiency improvement will reduce the effective price of energy services and hence at least partially mitigate original expected energy conservation therefore the magnitude of rebound effect is important for the design and timing of an effective energy conservation policy under the framework of translog cost share equations we estimates the direct rebound effect for heavy industry in china for the first time by conducting an empirical research on the relationship between the direct rebound effect and the ease with which energy services can substitute for other inputs additionally asymmetric price responses are specified in the model for the rebound effect estimation empirical results in our paper indicate that the rebound effect for heavy industry in china is about 74 3 this reveals that energy efficiency improvement can save energy to a certain degree since the rebound effect is less than 100 back fire but most of the expected reduction in heavy industry energy consumption is mitigated these findings prove that energy pricing reforms and energy taxes should be further implemented to achieve effective energy conservation in china s 12th five years plan

residential energy demand for space heating in the nordic countries accounting for interfuel substitution abstract reliable estimation of fuel consumption in residential sector is crucial for the future development of fuel supply system three approaches are compared in this study to capture climate impact as well as and interfuel substitution between fuels on residential fuel consumption for space heating in the nordic countries the first approach aims at directly estimating the demand for each energy carrier as a function of explanatory variables including heating degree days fuels price and gdp per capita the second approach is a two stage model combing an econometric model for total energy use for space heating and the market share for energy carriers based on cross price elasticities while in the third approach a set of simultaneous equations models were estimated based on the results of the mean average error and root mean square error criteria for three approaches across the nordic countries it was found that the second and third approaches were able to capture the complementary and substitution effects between fuels this finding confirms our hypothesis that the interfuel substitution is a key factor for estimating changes in fuel demand and should be accounted for when residential energy demand is projected the results additionally have important implications for climate change policy by exploring the impact of fuel price on residential energy demand for space heating

technical change inter factor and inter fuel substitution possibilities in pakistan a trans log production function approach abstract energy consumption in pakistan increased significantly over the last two decades primarily due to industrialization in order to meet the growing energy needs the government adopted short term policies by setting up thermal power projects which are more expensive both in terms of fiscal cost and environmental damages as compared to hydro power projects the former has exposed pakistan to international oil price shocks and environmental degradations this study therefore attempts to analyze technical change using trans log production function by employing non energy factors i e capital and labor and energy factors i e petroleum and natural gas to estimate elasticity of substitution the purpose of the study is to provide policy suggestions to the government on how to achieve high economic growth vis a vis improved energy security and environmental sustainability the results reveal that capital energy and labor energy are substitutes thereby suggesting the need for an increased focus on technological advancement and skilled employment generation to conserve energy and reduce co 2 emission a gradual elimination of energy subsidies which will make energy price reflects its true cost is required to further discourage increased energy consumption and promote capital intensive production methods a scenario analysis based on the elasticity of substitution between capital energy and petroleum gas shows the potential of energy conservation and emission mitigation the results further suggest the importance of a diversified energy supply mix characterized by abundant hydro and other renewable energy resources alongside natural gas

china s energy economy technical change factor demand and interfactor interfuel substitution with its rapid economic growth china s primary energy consumption has exceeded domestic energy production since 1994 leading to a substantial expansion in energy imports particularly of oil china s energy demand has an increasingly significant impact on global energy markets in this paper allen partial elasticities of factor and energy substitution and price elasticities of energy demand are calculated for china using a two stage translog cost function approach the results suggest that energy is substitutable with both capital and labor coal is significantly substitutable with electricity and complementary with diesel while gasoline and electricity are substitutable with diesel china s energy intensity is increasing during the study period 1995 2004 and the major driver appears to be due to the increased use of energyintensive technology

major oecd country industrial sector interfuel substitution estimates 1960 1979 abstract a range of static and dynamic translog based expenditure shares models are estimated for non energy producing industrial sectors of the major seven countries of the oecd area sectoral energy volume and fuel efficiency bias variables are shown to be significant over and above individual prices in explaining individual fuel expenditure shares statistically significant own price and cross price elasticities of demand are presented for individual countries with some magnitudes varying considerably across alternative model specifications

interfuel substitution a meta analysis interfuel substitutability has been of longstanding interest to the energy economics and policy community however no quantitative meta analysis has yet been carried out of this literature this paper fills this gap by analyzing a broad sample of studies of interfuel substitution in the industrial sector manufacturing industry or subindustries or macro economy of a variety of developed and developing economies publication bias is controlled for by including the primary study sample size in the meta regression results for the shadow elasticities of substitution between coal oil gas and electricity for forty six primary studies show that at the level of the industrial sector there are easy substitution possibilities between all the fuel pairs with the exception of gas electricity and coal electricity substitution possibilities seem more constrained at the macro level and less constrained in sub industries estimates also vary across countries publication bias does not seem to be present but model and data specification issues very significantly affect the estimates derived by each individual study estimates from cross section regressions are generally largest fixed effects panel estimates intermediate in magnitude and time series estimates are mostly much smaller econometric research suggests that the fixed effects estimates are likely the best among the existing studies though biased downwards

exploring the impacts of regional unbalanced carbon tax on co_2 emissions and industrial competitiveness in liaoning province of china carbon tax is regarded as a useful policy instrument to achieve the environmental target efficiently however the effect of regional unbalanced carbon tax is still unknown in this study an improved two region computable general equilibrium cge model is developed to fill this research gap with liaoning province and the rest of china roc as the study area business as usual bau and nine carbon tax scenarios are designed results show that in 2030 the highest carbon tax of 221 usd ton co 2 in taxc4p8 scenario in liaoning province will lead to carbon reduction of 44 92 with the cost of 5 54 gross domestic product gdp loss price effect and scale effect are the two mechanisms that affect the changes in gdp industrial output and co 2 emissions industrial structure energy consumption and carbon intensity of liaoning are overwhelmingly affected by the price effect most less energy intensive industries belong to the winner industries due to the higher influence of domestic market by contrast loser industries including most of the energy intensive industries are mainly affected by the changes of provincial and international markets roc region is mainly affected by the price effect suggestions about preferential developmental industries are offered to balance the environmental and economic concerns

environmental policy and double dividend in a transitional economy abstract although the environmental benefit from implementing a climate tax is usually realized the economic dividend still remains a controversial issue warranting further research this is because the impact of an environmental policy on an economy wide system will depend on factors that differ from one region to the next in this paper we develop a static cge model for liberia that is capable of analyzing both a uniform and a partial carbon tax policy under the uniform policy instituted to ensure mitigation in the range of 20 50 an economic dividend is found for energy employment and welfare in particular energy consumption increases by between 5 and 15 5 respectively interestingly under a second best policy which exempts economically strategic sectors from the tax no economic dividend is found for all three variables this time energy use declines by between 2 and 9 these suggest that a uniform environmental tax policy is a more viable option for liberia in particular as it does not only generate economic dividend for employment and welfare it also incentivizes liberia s adoption and use of renewable energy technologies in general based on the results obtained further conditions for the feasibility of a double dividend are proposed

structural optimization and carbon taxation in china s commercial sector abstract given china s economic transformation and upgrading process the green development of commercial sector is more and more important based on the trans log cost function this paper calculates the inter factor and inter fuel substitution effects in china s commercial sector from 1980 to 2016 besides the paper further analyzes the driving factors of the dynamic changes in energy intensity and the impact of carbon taxation in china s commercial sector the main conclusions are as follows 1 capital labor and energy in china s commercial sector negatively correlate with their prices and the self price elasticities of energy labor and capital decline in turn 2 the relationship between labor and capital is substitutional and the same relationship is found when after considering labor and energy and that between energy and capital is complementary 3 demand for energy sources negatively correlates with their prices and there exist complementary relationships between energy sources 4 technical effects and substitution effects can effectively promote the decline of energy intensity in china s commercial sector 5 implementing a 50 rmb tonne carbon taxation will lead to 5 50 energy savings and 6 21 co2 reduction

energy substitution effect on transport sector of pakistan based on trans log production function abstract transport sector because of the growing industrialization and urbanization of pakistan is one of fastest growing sector in terms of output energy consumption and co 2 emission its current performance and future outlook has the potential to leave behind problems related to the global issues of energy security and environmental sustainability the extents to which energy and non energy inputs are substitutable are the core issue in planning and designing of energy policies for this purpose we establish a trans log production function for pakistan transport sector and the input factors capital labor and energy are included output elasticities of each factor and the substitution elasticities between these factors have been estimated and analyzed for the sample period of 1980 2013 the results show higher output elasticity and that all pairs of factor inputs are substitutes because of the higher level of substitution elasticities the results suggest that by allocating more capital in the transport sector the relevant energy saving technology could be promoted thereby realizing the substitution between capital and energy and reduction of co 2 emission as a result it further suggest that by continuous upgrading of the capital substitution between energy and labor can also be achieved and the transition of pakistan transport sector from labor intensive to capital intensive can be realized

how stable is the demand for money in emerging economies one of the key elements of implementing the monetary policy is stability of the demand for money the literature includes a large number of studies that have tested the stability of the money demand in developed as well as less developed countries but not in emerging economies of eastern europe as market based data becomes available from these countries there is an urgency to test old theories for these modern market oriented economies in this article we consider the experiences of armenia bulgaria the czech republic hungary poland russia and the slovak republic using the bounds testing approach to error correction modelling and cointegration we show that money demand is stable in these countries

output and substitution elasticities of energy and implications for renewable energy expansion in the ecowas region abstract this study estimates output and substitution elasticities of renewable energy and nonrenewable energy for the economic community of west african states ecowas and discusses implications for expanding the former the results show that nonrenewable energy promises greater benefits for ecowas economic transition with output elasticities averaging between 0 052 0 579 and 0 055 to 0 223 for nonrenewable energy and renewable energy respectively overall estimated technological progress is low 0 5 to 2 6 the bulk coming from input efficiency substitution elasticities 0 02 0 94 suggest potential for switching towards renewable energy notwithstanding scale economics and sitting problems inherent in renewable power generation challenge the opportunities for energy substitution a sustainable policy solution therefore appears to be one favoring scaled and efficient electricity generation from fossil energy in the short run with a gradual switch towards renewable power in the long run in general the applied model provides insights that energy efficiency enhances sustainable growth by propelling technological advancement especially when technical change is scale biased and factor augmenting the study also provides insights that impacts of exogenous shocks to inputs are temporary and hence do not jeopardize efforts aimed at scaling output through increased and efficient use of labor capital and energy especially nonrenewable energy

can african countries efficiently build their economies on renewable energy abstract the translog production model is estimated to provide insights on the effectiveness of renewable energy for africa the analysis shows that capital labor renewable energy and nonrenewable energy drive output in african countries with renewable energy being a higher driver of growth than the conventional fossil fuels over the sample period this finding is reflective of the fact that renewable sources like wind hydro and solar account for a greater share of power generation in most african countries output elasticities computed for both energy types reaffirm the results and suggest that eastern and central african countries are more renewable energy dependent than the other three regions in addition technological progress is driven mainly by the efficiency with which various factors and energy inputs are used while africa has great potential of facing out conventional fossil energy the discussion provided in this study suggests that such transition is limited in practice due to issues of scale economics and sitting problems

options for mitigating the adverse effects of fossil fuel subsidies removal in ghana abstract conventional wisdom holds that without environmental benefits and revenue recycling fossil fuel subsidies removal would lead to welfare losses first this study tests the usefulness of general equilibrium theory for validating these claims and draws similar conclusion subsequently the model is readjusted to reflect simulation with two non traditional policy options this time the results suggest that removing subsidies on fossil fuels would create opportunities provided that such is done in tandem with complementary policies in particular we show that a mix of agricultural productivity improvement and a reduction in trade transaction costs at 15 in each case would provide benefits for fossil fuel subsidies removal in ghana these results underscore the need for structural reforms in ghanaian agricultural sector especially those aimed at promoting mechanized agriculture

a systemic approach to modelling and estimating demand for money ies this article uses a consumer theory based systemic approach to model the demand for monetary liquid asset holdings in chile we implement the suggestions and caveats of aggregation theory for the estimation of a demand system for liquid assets monies in static dynamic and time varying parameters setups our results are robust and theoretically consistent with consumer theory restrictions as a system derived from a utility maximizing framework and a quasi concave utility function in our estimations we find stability of interest rate elasticities in contrast to previous related literature we also document evidence that long short maturity rates are associated to less more liquid assets

optimal non linear health insurance abstract most theoretical and empirical work on efficient health insurance has been based on models with linear insurance schedules a constant co insurance parameter in this paper dynamic optimization techniques are used to analyse the properties of optimal non linear insurance schedules in a model similar to one originally considered by spence and zeckhauser american economic review 1971 61 380 387 and reminiscent of those that have been used in the literature on optimal income taxation the results of a preliminary numerical example suggest that the welfare losses from the implicit subsidy to employer financed health insurance under us tax law may be a good deal smaller than previously estimated using linear models

money demand income elasticity in advanced and developing countries new evidence from meta analysis this article extends the meta analysis presented in knell and stix 2005 2006 to investigate the possible sources of variations in empirical findings about the income elasticity of money demand in advanced and developing countries in the case of advanced countries we find that the income elasticities of money demand are significantly higher if broader definitions of the monetary aggregates are used in addition financial reforms and wealth seem to have significantly reduced the estimates of the income elasticity however we achieved quite different findings for the developing countries it appears that the broader definitions of monetary aggregates seem to produce income elasticity estimates that are only marginally higher than the narrower aggregates while the wealth financial reform impacts on income elasticity are statistically insignificant weakly significant both seems to have reduced the income elasticity estimates only marginally moreover some contrasting results between advanced and

are invisible hands good hands moral hazard competition and the second best in health care markets the nature and normative properties of competition in health care markets have long been the subject of much debate in this paper we consider what the optimal benchmark is in the presence of moral hazard effects on consumption due to health insurance intuitively it seems that imperfect competition in the health care market may constrain this moral hazard by increasing prices we show that this intuition cannot be correct if insurance markets are competitive a competitive insurance market will always produce a contract that leaves consumers at least as well off under lower prices as under higher prices

good subsidies or bad subsidies evidence from low carbon transition in china s metallurgical industry abstract since the metallurgical industry has become the main source of china s carbon dioxide emissions and energy consumption in recent years low carbon transition in that industry is of great significance for achieving china s carbon reduction targets it is generally believed that phasing out fossil fuel subsidies is an effective way to reduce energy related co2 emissions since it can increase the energy prices and lower its consumption this paper aims to investigate whether the energy subsidy removal can promote the low carbon transition of china s metallurgical industry taking inter fuel and inter factor substitution effects as the link we calculate the co2 mitigation potential on the assumption that the subsidies for each category of fossil energy were eliminated we find that the metallurgical industry has a sluggish reaction to the changes in energy price supposing eliminating the energy subsidies in the period of 2003 2015 the amount of reduced co2 would be 487 286 million tons accounting for a slight proportion of the total emissions in the industry but it is meaningful for the global co2 mitigation since it approximates the whole co2 emissions in norway during the same period these findings can provide some new insights for the energy subsidy issue and suggest that the additional measures are required to promote the low carbon transition in china s metallurgical industry rather than just relying on the removal of fossil fuel subsidies

uncertainty and the demand for medical care abstract this paper provides an analysis of the effects of uncertainty on the demand for medical care using a simplified version of grossman s human capital model of the demand for health two types of uncertainty are analysed the uncertainty surrounding the incidence of illness and the uncertainty surrounding the effectiveness of medical care in the first the consumer s basic level of health is assumed to be a random variable in the second the effectiveness of medical care is assumed to be random comparative static results are reported indicating the effects on the demand for medical care of both increases in the means of these distributions and mean preserving spreads of the distributions

measuring the energy input substitution and output effects of energy price changes and the implications for the environment abstract previous studies of decomposition of factor inputs have limited their analysis on the estimation of substitution and output effects however this paper develops a two step approach to estimate the substitution and output effects of changes in energy demand resulting from changes in prices and further examines the implications of these effects on co2 emissions using european industrial dataset over the period 1995 2007 in our empirical estimations instead of relying only on isur model like previous studies we introduced a multilevel model which is a more befitting model to our data our analysis covers industry as a whole and for different sector types the primary results emerged from our analysis suggest a strong evidence using the multilevel model generally our results show that production inputs are substitutable we find the substitution and output effects to be negatively related to co2 emissions however the substitution effects dominate from policy perspectives our results suggest that output adjustments may not play a significant role in reducing emissions we find the overall effects of changes in energy demand to be moderate then we argue that increment in energy taxes should be complemented by cleaner factor substitution and sustainable growth to achieve a desirable carbon reduction

interfuel substitution in the united states in this paper we use the locally flexible translog functional form to investigate the demand for energy and interfuel substitution in the united states and to provide a comparison of our results with most of the existing empirical energy demand literature motivated by the widespread practice of ignoring theoretical regularity we follow barnett s 2002 suggestions and estimate the model subject to theoretical regularity using methods developed by diewert and wales 1987 and ryan and wales 2000 in an attempt to produce inference consistent with neoclassical microeconomic theory moreover we use the most recent data published by the u s energy information administration eia and in addition to investigating interfuel substitution possibilities in total u s energy demand we follow serletis et al 2009 and also examine interfuel substitution possibilities in energy demand by sector moreover we test for weak separability with the objective of discovering the structure of the functional form in total energy demand as well as energy demand by sector

individual welfare when consumers can shop for health insurance i introduction the affordable care act aca of 2010 allows millions of americans to buy health insurance policies on competitive insurance exchanges as application denial is illegal consumers will be able to change health insurance policies when there are changes in the economic environment or health status the phenomenon of endogenous consumer contract choice is poised to play an important role in the study of health insurance demand and medical care utilization among the broad population not just for the elderly who can choose among alternative medicare plans this article illustrates the importance of endogenous consumer health insurance contract choice by analyzing the individual welfare effect of a reduction in the price of medical care a potential consequence of the aca we show that the insurance contract choice response is critical to determining the outcome ii prior literature the analysis of the individual moral hazard welfare effect of a medical care price decline was a topic of discussion in the literature during the last three decades of the previous century while there was disagreement on the perspective to take a conventional wisdom emerged as health insurance discounts the price of medical care the consumer faces a lower i e net price this causes moral hazard induced excess consumption and welfare loss for a given coinsurance rate a price decline further lowers the net price increases excess demand and exacerbates the welfare loss the conventional wisdom was challenged by gaynor haas wilson and vogt 2000 they focused on the competitive insurance company and allowed it to increase the coinsurance rate so as to offset the medical care price decline which leaves the net price demand and moral hazard induced welfare loss unchanged in the situation when the consumer decides to become uninsured they show that individual welfare loss can be reduced these form the basis for their proposition 1 the rest of their paper deals with societal welfare the current article relates to this proposition 1 the issue of individual moral hazard welfare loss as distinct from the issue of societal welfare the modeling approach has much in common with gaynor haas wilson and vogt 2000 our model is the dual we therefore shift the focus from the insurer to the consumer who explicitly exercises endogenous insurance contract choice we eschew their assumption of a unit elastic insurance demand and allow for other possible insurance demand responses not just the unit elastic one we show that if insurance demand is medical care price elastic then it is indeed possible to have a reduction in moral hazard welfare loss in our treatment however this outcome does not require the consumer to become uninsured furthermore and most important we show that the opposite can easily be true if insurance demand is inelastic i e the insured retains some portion of the reduction in out of pocket expense risk then moral hazard welfare loss increases after the price reduction although the increase is less than would occur in the absence of the contract choice effect our results build on our previous work in dusansky and k05 2006 we studied the role of health insurance choice in medical care demand taking a partial equilibrium approach the response of a competitive insurance industry was precluded in dusansky and koc 2010 we explored the interaction between the endogenous demands for health insurance and medical care demand using a more general principal agent model in which the competitive insurer s response to a medical care price change is explicitly allowed to alter the consumer s insurance choice set the current article extends that analysis to examine the effect of a medical care price change on individual consumer moral hazard welfare loss iii the model we employ a principal agent model in which the consumer faces health status uncertainty and is able to exercise endogenous insurance policy choice

optimal emission taxes for full internalization of environmental externalities abstract the present study proposes a set of optimal emissions fees that could be used to reduce the damages caused by industrial pollution the approach we use allows for the setting of pollution taxes at their economically appropriate level in particular tax rates are computed for china india and 19 sub saharan african countries all other world regions are grouped according to income level such as low income lower middle income upper middle income and high income economies our results show that constructed optimal pollution taxes range as high as 2 9 per 1 dollar of output for heavy manufacturing in the high income countries and as low as 0 01 in the service sectors of the low income countries these results show that a full internalization of the damages in each sector calls for raising the tax rates in some sectors and lowering them in others

renewable energy electricity development in ghana observations concerns substitution possibilities and implications for the economy abstract can ghana build its economy on renewable energy is it possible to substitute nonrenewable for renewable energy what is the impact of renewable energy on the economy of ghana these questions are relevant and worth considering as far as the renewable energy development agenda in ghana is concern using the translog production function approach this study primarily investigates whether ghana can move away from nonrenewable electricity generation to renewable power generation in particular we provide estimates for the relationship between the two energy types and output the estimates are then used to calculate the output and substitution elasticities between renewable and nonrenewable energy our findings show that while the impact of nonrenewable energy on ghana s economy is negative that of renewable energy is insignificant with output elasticities for both energy types averaging 0 139 and 1 875 respectively even though substitution elasticity suggests the possibility of moving towards a renewable power generation system this study also highlights the limitations associated with such transition citing inherent problems such as scale cost and location based on the analysis done in the context of the findings this study recommends a policy that supports an optimal energy matrix with both renewable and nonrenewable sources

impacts of technological change on factor substitution between energy and other inputs within us agriculture 1950 79 abstract past efforts to estimate elasticities of substitution between inputs both in and out of agriculture have usually made use of a single data set to provide the elasticities between the input pairs and have led to highly conflicting results particularly with respect to the substitution between capital or machinery and energy this study reveals that the elasticity of substitution between a number of input pairs in agriculture can vary by substantial amounts depending on the time period used for the estimation energy in agriculture which was a complement for machinery in the 1950s was a substitute by the 1970s

industry level production functions and energy use in 12 eu countries abstract in the eu context industrial sectors have significantly reduced their energy consumption in the last decade despite significant disparities existing across industry branches comparative studies focused on the effect of energy use in the production growth of the different industry branches are limited and not related to the eu countries this study undertakes a production growth approach to analyze the effect of energy use in different industry branches through the estimation of translog production functions based on data from 12 eu countries during the 2000 2014 period in addition two sub periods are studied to evaluate if industrial energy efficiency has been improving through time specifically from 2007 findings confirm the existence of different behavior patterns with respect to energy use in the considered sectors and from one sub period to another as a result policy measures should be sector specific since no general production energy use patterns can be obtained

investigating co2 mitigation potentials and the impact of oil price distortion in china s transport sector abstract the transport sector is a major source of oil consumption and co2 emissions in china however due to the regulated pricing mechanism in china the end user oil price cannot reflect real market price and thus oil price distortion exists therefore the main aim of this paper is to study the affecting mechanism of oil price distortion on co2 emission mitigation firstly the level of oil price distortion is evaluated and a dynamic trans log cost function model is built to analyze the substitution relationship among energy products secondly the own price elasticity and cross price elasticity for fuel demand are calculated based on provincial panel data of china s transport sector over 2004 2016 finally co2 mitigation potentials are estimated by removing the impact of oil price distortion results show that 1 there is positive oil price distortion over 2004 2016 2 substitute relationship is observed between oil and coal oil and electricity and the substitution relationship is affected by factor substitution 3 removing oil price distortion will reduce co2 emissions of china s transport sector by 599 million tons in the studying period policies should focus removing the impact of oil price distortion promoting electricity oil substitution and promoting capital energy substitution to mitigate co2 emissions

health insurance the tradeoff between risk pooling and moral hazard choosing optimal health insurance coverage involves a trade off between the gain from risk reduction and the deadweight loss from moral hazard this paper examines this trade off empirically by estimating both the demand for health insurance and the demand for health services it relies on data from a randomized controlled trial of cost sharing s effects on the use of health services and on the health status for a general non elderly population

does improved environmental quality prevent a growing economy abstract a major concern for sustainable development is how countries can lower pollution while avoiding adverse output and energy shocks since economic activities change with time we develop a dynamic applied equilibrium model to study the dynamics of co2 emissions and evaluate how the pursuit of environmental policy objectives can influence output and productivity in a surrogate country in transition under an optimal environmental policy which ensures mitigation between 38 and 50 we show that productivity projected towards the year 2075 increases slightly from between 3 8 and 6 2 to between 5 7 and 7 6 respectively the required carbon tax begins from 5 29 ton in 2020 and grows on average by 3 5 reaching up to 35 83 per ton carbon towards the year 2075 even though these tax rates ensure huge benefits for mitigation they represent marginal productivity growth and substantial output and consumption costs in other words improved environmental quality presents opportunities for multifactor productivity mfp but this productivity improvement is too marginal to offset the compliance costs of the carbon tax thereby causing output to decline hence to ensure maximum economic dividend from carbon pricing especially in transitional economies measures are required to improve the innovation benefits of carbon taxes towards levels that offset the compliance costs of environmental regulations otherwise caution should be taken by developing countries in their environmental policy designs especially when boosting consumption and economic growth is a major priority

a money demand function with output uncertainty monetary uncertainty and financial innovations in a general equilibrium framework incorporating the money in the utility function approach we show that output uncertainty and monetary uncertainty as well as output interest rates and financial innovations affect money demand the estimated long run relationships are consistent with our postulated relation but not with the conventional one our model delivers a high income elasticity consistent with cross sectional evidence and helps resolve m1 demand puzzles the model estimated in dynamic error correction form exhibits a good level of stability and forecastability providing little support for the recent de emphasis of monetary aggregates due to the instability of money demand

oil price fluctuation volatility spillover and the ghanaian equity market implication for portfolio management and hedging effectiveness abstract this study attempts to contribute to the literature on stock markets and energy prices by examining the dynamic volatility and volatility transmission between oil and ghanaian stock market returns in a multivariate setting using the recently developed var garch var agarch and dcc garch frameworks in turn the models results are used to compute and analyze the optimal weights and hedge ratios for oil stock portfolio holdings for comparison purposes and to put the paper more in the perspective of west africa the nigerian stock market is also included in the analysis our findings point to the existence of significant volatility spillover and interdependence between oil and the two stock market returns while spillover effects are stronger for nigeria the transmission of volatility is much more apparent from oil to stock than from stock to oil in the case of ghana also the study demonstrates evidence of short term predictability in oil and stock price changes through time and reveals that conditional volatility changes more rapidly as result of substantial effects of past volatility rather than past news shocks for all market returns moreover we show that there is a slightly more effective hedge in the two stock markets under the dcc garch framework our preferred model compared to the other two models although hedging effectiveness is much greater for ghana on the whole our findings for optimal hedge ratios are consistent with other studies and particularly the view that oil assets should be an integral part of a diversified portfolio of stocks and suggest that a better understanding of volatility links is crucial for portfolio management in the presence of oil price risk finally the existence of multivariate asymmetric effects and dynamic conditional correlations as revealed by the var agarch and dcc garch models make it clear that the assumptions of symmetric effects and constant conditional correlations are not supported empirically

health care insurance and the contract choice effect i introduction it is well known that consumers anticipate some aspects of their medical care consumption examples include obstetrical services dental procedures vision care outpatient mental health services and minor elective surgery so that medical care demand anticipation influences the choice of health insurance coverage in turn the characteristics of the chosen plan set the degree of cost sharing and therefore the net price that the consumer faces which is given by the percentage of cost sharing times the gross price of medical care this net price influences the consumer s actual demand for the broad range of medical services 1 in this way insurance choice is influenced by particular anticipated utilization and actual general utilization is influenced by the selected insurance plan health insurance choice and medical service demand are interdependent although this interdependence has been noted in the literature few researchers have attempted to model it 2 and none have explicated its implications for consumer demand behavior and the ensuing econometric analysis of medical care demand we do so in this article using an intertemporal model that highlights the role of expectations in the insurance choice medical care demand interaction under uncertainty we show that the medical care demand response to a change in its gross price consists of two separate components the standard neoclassical demand effect and an insurance contract choice effect when the gross price of medical care changes the net price to the consumer is altered for a fixed degree of cost sharing however a change in the gross price can prompt a change in the intended choice of health plan causing a change in the degree of cost sharing for example if the gross price of medical care rises our consumer may choose to pay a higher premium for an insurance policy that is more generous one that has a lower cost sharing percentage in this case the net price which first increased exogenously would now decrease endogenously the health insurance contract choice effect can play an important role in determining the consumer s observable demand response to a change in the gross price of medical care the standard medical care demand curve could be less responsive because of it and econometric studies of the price elasticity of medical care that ignore it which is typically the case in the literature would produce estimates that are erroneous furthermore although somewhat remote the contract choice effect opens the door to a perverse outcome a medical care demand curve that is upward sloping this could occur when the contract choice effect is very strong ii the model we consider an individual consumer who faces a single period two stage planning problem in the first stage the consumer makes an ex ante choice of insurance plan at the time this choice is made he knows his income for the period all prices including the gross price of medical care and his current health status however he is uncertain about his future health status in the second stage during which health status uncertainty is resolved the consumer makes ex post decisions about purchases of medical care and other goods in the first stage the consumer chooses from a variety of health insurance policies with varying characteristics the simplest has a deductible of some amount e g 250 per person 750 per family a percentage cost share e g consumer pays 20 the insurance provider 80 of each episode and a cap on total dollar outlay beyond which the insurer pays 100 of remaining expenses other policies place more emphasis on co payments e g consumer pays 20 to a physician for an office visit the insurance provider pays the balance of the negotiated cost and some policies combine all of these elements co pays for office visits 20 80 cost shares for hospital stays different mixes of percentage cost shares depending on services that are out of network in network but not preferred provider and so on

an analysis of company choice preference to carbon tax policy in china abstract this paper summarizes an analysis of choice preferences of chinese companies to the design options of carbon tax policy the data were collected from 201 companies with around half of them based in the western shanxi province and the other half from the eastern jiangsu province modeling analysis of the discrete choice dataset confirms the statistically significant relationships between the company s preferences to carbon tax policy with the policy attributes including tax rate tax relief measures and the revenue utilization from the viewpoint of chinese businesses the option of carbon tax policy with tax rate at 10 30 yuan t co 2 allowing tax relief to energy intensive sectors using the revenues specific for climate change and starting as early as the 13th five year plan period 2016 2020 would be preferable and realistic the results of this research may be referred for the discussions and development of carbon tax policy in china

fossil fuel flexibility in west european power generation and the impact of system load factors this paper analyzes short run interfuel substitution in west european power generation and the impact of system load factors on fossil fuel choice the problems are studied within a restricted translog cost share model the paper concludes that interfuel substitution in existing power plants is substantial especially that between oil and gas this is consistent with the notion that short run fuel substitution takes place in dual or multi fired plants by switching load between different single fired plants and by some conversions of power plants to be able to burn alternate fuels the empirical investigation also indicates that the system load factor is a notable determinant of fossil fuel choices in west europe and the paper ends with an assessment of the fuel consequences of some load management schemes in the region

delving into liberia s energy economy technical change inter factor and inter fuel substitution abstract the industrial energy mix of liberia is dominated by petroleum products this has generated serious environmental problems contributing immensely to co 2 emissions and other pollutants in the country this study has attempted to investigate the potential for inter factor and inter fuel substitution between capital labor petroleum and electricity in liberia by employing a translog production and cost function approach ridge regression procedure has been adopted to estimate the parameters of the function due to multicollinearity in the data estimation results show that all inputs are substitutes these suggest that price based policies coupled with capital subsidy programs can be adopted to redirect technology use towards cleaner energy sources like electricity hence retaining the ability to fuel the economy while also mitigating greenhouse gas ghg emissions substitution between energy and labor and energy and capital implies that removal of price ceilings on energy in liberia would tend to reduce energy use and increase capital and labor intensiveness notwithstanding the study seems to show no evidence of convergence in relative technological progress of the four inputs implying that petroleum will continue to play a dominant role in the energy consumption mix of liberian industry while labor investment will continue to outweigh capital inputs finally the findings of this study provide general insights and underscore the importance of policies that focus on installed capacity of renewable electricity energy intensity targets as well as merger of enterprises

factor substitution and energy productivity fluctuation in china a parametric decomposition analysis abstract technical research on energy productivity can support government officials as they evaluate practical energy policies for the future this study proposed a parametric method to decompose china s energy productivity rate of change into six factors based on a theoretical stochastic frontier analysis the method was applied to conduct an empirical study using inter provincial panel data in china from 1995 to 2012 the results highlighted three key points first the general rate of change in energy productivity was mainly influenced by a steady positive rate of change in technical progress combined with a steady negative rate of change in technical efficiency the core factors causing fluctuations in energy productivity included a positive rate of change in the substitution of capital and energy and a negative rate of change in the substitution of labor and energy second from a geographic perspective provinces with a high rate of change in technical progress experienced a weaker deterioration in technical efficiency however the rate of change in technical efficiency tends to decline as the rate of change in technical progress increases third there is a similar changing trend between the substitution of capital and energy and the substitution of labor and energy

renewable energy technologies as beacon of cleaner production a real options valuation analysis for liberia abstract the importance of energy consumption for growth and development calls for improved decision support for a sustainable energy transition given africa s dependence on fossil fuels the economic and environmental savings from research development and deployment of renewable energy technologies may be substantial although the benefits of renewable energy technologies research development funding may appear to be low assuming immediate deployment the uncertainty in the non renewable energy price and the flexibility over timing makes research development program more appealing this study develops different scenarios in order to quantify benefits provided by research development funding for renewable power generation in liberia by using real options pricing approach to estimate the value of renewable energy technologies while taking into account the uncertainty of fossil fuel prices and learning by doing in renewable energy technologies the optimal solution shows that renewable energy technologies are economically attractive especially when external costs are internalized however annual research development funding is low and should be raised significantly in order to guarantee the highest possible investment incentives with minimal expenditures the study also hypothesizes that with the likelihood of renewable energy to replace non renewable energy renewable power use in liberia can potentially reduce carbon dioxide emissions by approximately 13 9 by 2015 compared to the 2008 levels the key insight provided by the real options analysis in this study is that while renewable energy may have inherent limitations such as seasonality of supply low energy content and capacity factor issues they still hold a significant amount of value which can only be detected when externalities are internalized thus underscoring the need for external costs related policies

the demand for health some new empirical evidence this paper presents some new estimates of the pure investment and pure consumption models of the demand for health in contrast to previous studies the paper presents parameter estimates of both reduced form and structural demand for health care equations the latter which are obtained by treating health capital as a latent variable in a recursive equation system provide a safer way of checking the consistency of the model s predictions with the data the present analysis of the pure consumption model differs from previous analyses in its recognition of the dependency of the shadow price of initial assets on the entire lifetime profiles of the model s exogenous variables the paper also explores the implications in terms of reliability of parameter estimates of the failure on the part of previous studies to recognize this

valuing chinese feed in tariffs program for solar power generation a real options analysis newhuadu business school research fund china sustainable energy program g 1305 18257 national social science foundation of china 12zd059 ministry of education 10gbj013

effects of credit and debit cards on the currency demand we analyze the effects of credit and debit cards on the currency in circulation by using gmm estimation instead of using the data obtained by surveys we use monthly data obtained by an interbank institution that keeps the statistics of all credit and debit cards usage of a small open economy turkey for the period over 2002m1 2006m10 as expected from the theory we find that an increase in the usage of credit and debit cards leads to a decrease in the currency demand moreover the usage of the debit cards has a bigger effect on the money demand compared to the usage of the credit cards we also find that the effect of credit cards is mostly through purchases and the effect of debit cards is mostly through withdrawals

comparing climate policies to reduce carbon emissions in china new huadu business school research fund national social science foundation of china 12zd059 shandong social science planning fund program 12djjj12 independent innovation foundation of shandong university iifsdu 2012gn038 ministry of education research of social sciences china postdoctoral science foundation 2013m530309

output elasticities and inter factor substitution empirical evidence from the transportation sector of shanghai abstract as a major consumer of fossil fuels the transportation sector in shanghai presents a wide range of problems including air pollution noise and traffic congestion this study aims to explore the energy substitution effect based on a trans log production function to evaluate the contribution of each input factor to sectoral output and reveal the substitution possibilities between capital labor and energy to deal with a multicollinearity problem we adopt ridge regression to obtain the coefficient of each variable under the appropriate penalty value the bootstrap method is used for making statistical inferences and the 95 confidence interval is obtained with 1000 bootstrap samples the empirical results demonstrate the following 1 the output elasticities of capital 0 13 0 15 labor 0 24 0 25 and energy 0 43 0 48 are positive and show an increasing trend over the study period 2 the substitution elasticity between labor and energy is the highest among the input factors around 1 0095 with a slight decreasing trend 3 the substitution elasticity between energy and capital ranges from 1 0018 to 1 0021 and the substitution elasticity between capital and labor is infinitely close to 1

does factor market distortion inhibit the green total factor productivity in china abstract this article measures green total factor productivity gtfp to discuss whether factor market distortions inhibit the green development of china s economy meanwhile export and foreign direct investment fdi are taken into account based on a threshold model considering export and fdi are closely related to factor market distortion environment and the economy the result shows that the factor market distortion has negative influences on china s gtfp growth export and fdi s spillover effect significantly moreover factor market distortion was found to be the threshold of export and fdi s spillover effect leading to inferior export and fdi which further inhibit gtfp growth this article provides a supplement to the issue from the perspective of environment based on the widely confirmed proposition that factor market distortion inhibits tfp growth according to the results we suggest that the chinese government should reduce the control of factor market as much as possible leaving the factor resources allocation to the market this will not only promote an innovation driven development but also an energy saving and environment friendly economy in china the article provides a new perspective on the influence mechanism of export and fdi on gtfp growth by discussing the impact path of factor distortion and expands the empirical framework of the research direction as well