A Residential Energy Demand System for Spain
University of Vigo - Faculty of Economics and Business
J. Maria Labeaga Azcona
Universidad Nacional de Educacion a Distancia (UNED) - Faculty of Economics
Miguel Rodríguez Méndez
University of Vigo - Department of Economic Analysis
MIT Center for Energy and Environmental Policy Research Working Paper No. 2005-001
Sharp price fluctuations and increasing environmental and distributional concerns, among other issues, have led to a renewed academic interest in energy demand. In this paper we estimate, for the first time in Spain, an energy demand system with household microdata. In doing so, we tackle several econometric and data problems that are generally recognized to bias parameter estimates. This is obviously relevant, as obtaining correct price and income responses is essential if they may be used for assessing the economic consequences of hypothetical or real changes. With this objective, we combine data sources for a long time period and choose a demand system with flexible income and price responses. We also estimate the model in different sub-samples to capture varying responses to energy price changes by households living in rural, intermediate and urban areas. This constitutes a first attempt in the literature and it proved to be a very successful choice.
Number of Pages in PDF File: 39
Keywords: Households, energy, demand, spain, location
JEL Classification: D12, Q41, R22working papers series
Date posted: April 5, 2005
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