A CROSS-COUNTRY DECOMPOSITION ANALYSIS OF MANUFACTURING ENERGY-CONSUMPTION

A decomposition method is used to divide a change in manufacturing energy consumption into three effects: output growth, energy intensity and structural change, using energy-balance tables and manufacturing statistics for 26 selected countries in the period 1973-1980 and 1980-1988. The findings seem to confirm the decoupling of energy and output in developed countries in contrast to the presence of a positive relationship between industrial output and energy consumption in developing countries. Moreover, rapid growth in manufacturing output, coupled with energy-intensive industrialization, seems to be the dominant factor in increasing manufacturing energy consumption in developing countries, while improved energy intensity and less energy-intensive structural change seem to exert a more pronounced dampening impact on manufacturing energy consumption in developed countries than in developing countries.