Energy, Efficiency Gains and Economic Development: When Will Global Energy Demand Saturate?

44 Pages Posted: 5 Jan 2021

See all articles by Christian Bogmans

Christian Bogmans

International Monetary Fund (IMF)

Lama Kiyasseh

International Monetary Fund (IMF)

Akito Matsumoto

International Monetary Fund (IMF)

Andreas Pescatori

International Monetary Fund (IMF)

Date Written: November 1, 2020

Abstract

Not anytime soon. Using a novel dataset covering 127 countries and spanning two centuries, we find evidence for an energy Kuznets curve, with an initial decline of energy demand at low levels of per capita income followed by stages of acceleration and then saturation at high-income levels. Historical trends in energy efficiency have reduced energy demand, globally, by about 1.2 percent per year and have, thus, helped bring forward a plateau in energy demand for high income countries. At middle incomes energy and income move in lockstep. The decline in the manufacturing share of value added, globally, accounted for about 0.2 percentage points of the energy efficiency gains. At the country level, the decline (rise) of the manufacturing sector has reduced (increased) US (China) energy demand by 4.1 (10.7) percent between 1990 and 2017.

JEL Classification: O11, O13, O44, Q43, D31, L60, E21, Q41

Suggested Citation

Bogmans, Christian and Kiyasseh, Lama and Matsumoto, Akito and Pescatori, Andreas, Energy, Efficiency Gains and Economic Development: When Will Global Energy Demand Saturate? (November 1, 2020). IMF Working Paper No. 20/253, Available at SSRN: https://ssrn.com/abstract=3758087

Christian Bogmans (Contact Author)

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Lama Kiyasseh

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

Akito Matsumoto

International Monetary Fund (IMF) ( email )

700 19th Street NW
Washington, DC 20431
United States

Andreas Pescatori

International Monetary Fund (IMF) ( email )

700 19th Street, N.W.
Washington, DC 20431
United States

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