Energy Shock And Industry Structure Transfer

The effects of energy shock on one country's economic have two sides:One the one hand, the energy shock will bring up the cost of the whole society's production, which can bring in the recession and inflation. On the other hand, energy shock will deflate every department's production with different level, because of their different energy dependency. And then it will have a good effect on the industry structure in long-term. This article will analyze the effects of energy shock on China's industry structure adjustment from the positive perspective. And in the course of this study, we will take the factor of energy-saving technological progress into account to analyze the role of technological progress in the energy-shocking and the process of industry restructuring.In this paper, we build a simple China's recursive dynamic computable general equilibrium (CGE) model in accordance with China's macroeconomic performance. Then according to2007social accounting matrix (SAM) and the results of previous studies, we calibrate the parameters of the macroeconomic. In the same time, we fix up the economic growth and labor force growth rate between2007and2030as exogenous parameters. And, on this base, we simulate the benchmark of China's macroeconomic scenario between2007an2030. Then we will find that under the structure of China's economy in2007, if the rate of our country's economic growth keeps in a steady level from now to2030, China's industry structure will be gradually improved with the proportion of service industries increasing, the proportion of manufacture industries declining, and the proportion of agriculture industries relatively stable.After calibrating the benchmark of our country's macroeconomic scenario, we make the economies experiencing an energy shock—the price of energy rising100%in2015. We find, under the energy shock, the manufacture industries have the greatest reduction, the serve industries take the second place, and the agriculture industries have the least reduction. And the industry structure has indeedly been optimized by this energy shock.With energy price rising, it is bound to induce a series of energy-saving technologies and the application of these technologies. In order to clarify the role of technological progress in the energy shock and the process of industry restructuring, we introduce three types of technological progress scenario:The type of technological progress A, all the sectors have no energy-saving technological progress; the type of technological progress B, only the energy-intensive sectors have the energy-saving technological progress, and with the progress rate of4%annually; the type of technological progress C, all the sectors have the energy-saving technological progress, and with the progress rate of4%annually. By the simulation, we find, either before the economy suffering the energy shock in2015, or when the economy suffering the energy shock, the type of technological progress C both has a beneficial effect on China's macro economy. And this is mainly reflected in such phenomenon:the type of technological progress C will accelerate the speed of our country's industry structure transformation when the economy does not suffer from the energy shock; when energy shock is coming, the type of technological progress C will ease the tightening effect of energy price rising on various departments on the hand, on the other hand, it will increase the proportion of service industry compared with the type of technological progress B, and guide the transformation of China's industry structure upgrade.