Domestic R&D activities, technology absorption ability, and energy intensity in China. (March 2020)

• Record Type: Journal Article
• Authors: Huang, Junbing; Chen, Xiang
• Is Part Of: Energy policy. Volume 138(2020)
• Publication Date: 2020-03
• Subjects: Domestic R&D -- Energy intensity -- Panel threshold model -- Human capital stock; Energy policy -- Periodicals; Politique énergétique -- Périodiques; Electronic journals; 333.79
• DOI: 10.1016/j.enpol.2019.111184
• Languages: English
• ISSNs: 0301-4215

Abstract

Abstract: Domestic research and development (R&D) activities are critical for the development of China's low-carbon economy. The higher level of R&D inputs, the more advanced technology will generate, therefore contributing to the energy intensity reduction. In empirical studies, the effect of R&D activities on energy intensity has been investigated extensively, however, most studies consider R&D activities as a whole. Consequently, we lack detailed information on the role of each R&D player and stage for appropriate policy consideration. Furthermore, the effects of R&D activities may be determined by factors affecting technology absorptive ability. To understand the influence of R&D activities on energy intensity, we employ linear and nonlinear analyses using a Chinese provincial dataset covering 2000–2016. The linear analysis suggests that domestic R&D is powerful in reducing energy intensity. However, this positive effect is mainly from experimental and developmental R&D activities rather than basic R&D and application activities. Further, R&D activities by industrial enterprises have a stronger effect on energy intensity reduction than those of higher education and independent R&D institutions. Additional study using panel threshold models suggests that the effects are not linear but experience structural breaks when human capital stock and full-time equivalent (FEP) R&D personnel are at different levels. Highlights: We study the influence of R&D stages and actors on energy intensity in China. The results suggest that indigenous R&D activities can reduce energy intensity. This positive effect is mainly from experimental and developmental R&D activities. The strongest effect on energy intensity reduction is from industrial enterprise R&D. Policy should also increase R&D personnel for better energy intensity reduction.