Analysis Of Energy Efficiency Convergence In China Based On Structural Breaks Theory

With the rapid growth of the global economy and the accelerating process of industrialization, energy constraint is becoming a serious problem. Energy efficiency gradually becomes an important indicator of economic development for various countries when they make related policy. To maintain a steady economic growth, the corresponding energy should be invested continually. Energy efficiency improvement eases the growing contradiction between energy supply and demand in the economic growth process. Compared with the developed countries, the energy efficiency level of China is still in a backward position, and the consumption still stays in an extensive pattern. In recent years, with the enlargement of the economic gap between different regions in our country, many domestic scholars has paid attention on the convergence of regional energy efficiency and achieved many creative achievements. From the previous studies, we can find that the low efficiency of energy utilization will inevitably produce the waste of energy and high pollution. However, if the regional energy efficiency differences can be weakened, then regions with a high level of energy efficiency will positively influence regions with a low level of energy efficiency. The entire energy efficiency in China can then be significantly enhanced. But it is ignored by the existing studies for a long time that energy efficiency may be influenced by structure breaks. The mutation mechanism of the influence on structure breaks resulted by exogenous shocks has very important practical significance for the design of economic strategy. Moreover, up till now, most of the researches on energy efficiency adopted panel data. As we know, panel data has a lot of disadvantages, which is the same as cross-section data. All of these will lead to inaccurate policy guidance. Based on the structural breaks theory, this paper will combine the methods of normative research and empirical research, using panel data and time series data to study the energy efficiency of China, aimed to come to the conclusion that if the energy efficiency in overall, eastern, central, western, and all provinces in China has structural breaks; then on the basis of the structural breaks, ?-convergence analysis will be conducted, for the purpose of providing theoretical and empirical support for energy conservation and emissions reduction.The following is a summary of our conclusions:(1) All of the energy efficiency of whole China, the east, central and west hsupport convergence theory with structural breaks. The whole and the east have one structural break, and both the central and the west have two structural breaks. The locations of structural breaks are consistent with the acceleration of industrial process, the industrial transfer, the promulgation of the energy policy and so on. All of these regions support ?-convergence, and the speed of ?-convergence is about 6%, which shows the gap between regional energy efficiency levels will be gradually narrowed.(2) Most of the provinces of China support convergence theory with one or two structural breaks. There are 25 provinces support stochastic convergence, showing structural mutations changed the equilibrium level and growing path of energy efficiency. There are 19 provinces support ?-convergence, showing structural mutations put a positive effect on energy efficiency in different provinces, and the energy efficiency will improve in a long period.