Research On The Relationship Between Energy Consumption And Economic Growth In China

With the development of global economy, the restrain of energy on the the sustaining development of the economy has become apparent increasingly, which makes some countries in the world pay more attention to the development of energy field, especially to the development of energetic economy. Since 2003, the pattern of economic growth of China has turned conversely to the relay on high input of energy, especially in the field of industries, which violates the energy policies:go to the way of new industries. This change not only aggravates the paradox of the energy supply-demand in China, but also jeopardy the safety of energy of China. Therefore, a lot of researches focused on relationship between energy consumption and economic growth in China have poured out. The energy economy in China also develops at fast speed.At present, the researches about energy consumption and economic growth mainly go on from the respective of theoretic analysis or empirical analysis. However, the papers which have researched the relationship between energy consumption and economic growth by combining the theoretic analysis or empirical analysis are few, which give lot of helpful suggestions for discovering the relationship between energy consumption and economic growth. what is more, there are still some places that need being perfected in former researches, for example, in the former theoretic researches, few papers used the economic model which is fit for the practically economic background to analyze deeply the way in which energy consumption influences economic growth, and used this type of model to explain economic phenomena. In empirical analysis, the number of sample of former papers is not so sufficient to make empirical result reliant, some papers have not considered seriously about the selection of variables, some have misused the methods of econometric. Finally few papers have done some robust analysis about the results of empirical analysis. Considering that energy consumption has significant meaning to economic growth of China and to country safety, and that former researches have some deficient, the paper based on the advantage of research methods of former authors has researched the relationship between energy consumption and economic growth from both perspective of the explanation of theoretic model and empirical analysis. In the part of theoretic model, the paper has firstly introduced the energy consumption into economic growth model of new class, and then analyses how the various rate of energy consumption influence economic growth of China when economy is in the state of stability. The main conclusion of the paper is the rate of per capita output equals to speed of technique progress multiplied the speed of energy consumption and then the paper deeply analyses the economic meaning of the conclusions of inferring of economic model. In the part of empirical analysis, at firstly the paper has seriously deal with the economic variables including total yields, input of capital, and input of labor from 1952 to 2006 in order to make sure that datas meet to the requirement of empirical analysis. And then the paper has tested the relationship between energy consumption and economic growth using co-integration technique and error correction model. The research concludes that there exists equilibrium relationship in the long term and exists volatile relationship in the short term in the economic system of energy consumption, the real yields, the real input of labor, and the real input of capital and efficiency. In order to test whether there exists non-linear, asymmetry relationship between energy consumption and economic growth, the paper also has done robust analysis about empirical results above. The conclusion of the robust test is that the difference between the results of robust test and the results of former empirical analysis can be accepted considering the difference between the way of dealing with data and the methods of econometric. The part of empirical analysis not only have tested there exists equilibrium relationship in the long term, but also have tested there may exists non-linear, asymmetry relationship between energy consumption and economic growth.The paper also has predicted the amount of the real yields and energy consumption of China in the ten years of the future based on VECM. In the last of the paper, by observing the situation of China, paper has analyzed the existing problems of energy in China and has offered some helpful suggestion based on the research above. Author of this paper expect the research work can provide theoretic support and data support for the relevant government administers to make some proper policies.