Technology Invention and Diffusion in Residential Energy Consumption. A Stochastic Frontier Approach

38 Pages Posted: 19 Sep 2015

See all articles by Giovanni Marin

Giovanni Marin

National Research Council (CNR) - Centre for Economic Research on Firms and Growth (CERIS); Observatoire Français des Conjonctures Economiques (OFCE)

Alessandro Palma

Gran Sasso Science Institute; University of Rome Tor Vergata - Centre for International Studies on Economic Growth (CEIS)

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Date Written: September 18, 2015

Abstract

Traditional large appliances absorb a large share of residential electricity consumption and represent important targets of energy policy strategies aimed at achieving energy security. Despite being characterized by rather mature technologies, this group of appliances still offers large potential in terms of efficiency gains due to their pervasive diffusion. In this paper we analyse the electricity consumption of a set of four traditional ‘white goods’ in a panel of ten EU countries observed over 21 years (1990-2010), with the aim of disentangling the amount of technical efficiency from the overall energy saving. The technical efficiency trend is modelled through a set of technology components representing both the invention and adoption process by the means of specific patents weighted by production and bilateral import flows, which allows to overcome the rigid Stochastic Frontier framework in modelling the effect of technical change. Our results show that the derived energy demand and inefficiency trends are both related to changes in the amount of available technology embodied in energy efficient appliances. The effect is significant both in its domestic and international components and suggests an active role of innovation and trade policies for achieving efficiency targets which directly impact the amount of electricity consumed by households.

Keywords: energy efficiency, technological diffusion, electrical appliances, stochastic frontier analysis, residential sector

JEL Classification: O33, Q55, Q41

Suggested Citation

Marin, Giovanni and Palma, Alessandro, Technology Invention and Diffusion in Residential Energy Consumption. A Stochastic Frontier Approach (September 18, 2015). Available at SSRN: https://ssrn.com/abstract=2662362 or http://dx.doi.org/10.2139/ssrn.2662362

Giovanni Marin

National Research Council (CNR) - Centre for Economic Research on Firms and Growth (CERIS) ( email )

Via Avogadro 8
10121 Torino
Italy

Observatoire Français des Conjonctures Economiques (OFCE) ( email )

69 Quai d'Orsay
Paris 75004
France

Alessandro Palma (Contact Author)

Gran Sasso Science Institute ( email )

viale Francesco Crispi, 7
L'Aquila, 67100
Italy

University of Rome Tor Vergata - Centre for International Studies on Economic Growth (CEIS) ( email )

Via Columbia, 2
Rome, I-00133
Italy

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