Human capital and energy consumption: evidence from OECD countries

Yao Yao; Kris Ivanovski; John Inekwe; Russell Smyth

doi:10.1016/j.eneco.2019.104534

Human capital and energy consumption: evidence from OECD countries

Yao Yao, Kris Ivanovski, John Inekwe, Russell Smyth

Department of Economics

Research output: Contribution to journal › Article › Research › peer-review

Abstract

We examine the effect of human capital on energy consumption for a panel of OECD economies over the period 1965–2014. Our preferred results, which account for cross-sectional dependence and structural breaks, suggest that a one standard deviation increase in human capital reduces aggregate energy consumption by 15.36%. When we distinguish between clean and dirty energy consumption, we find that human capital generates significant positive externalities for the environment. Specifically, we find that a one standard deviation increase in human capital is associated with a 17.33% decrease in dirty energy consumption and an 85.54% increase in clean energy consumption. Our findings reinforce the social benefits of investing in human capital and suggest a promising avenue for energy conservation without impeding economic growth.

Original language	English
Article number	104534
Number of pages	14
Journal	Energy Economics
Volume	84
DOIs	https://doi.org/10.1016/j.eneco.2019.104534
Publication status	Published - Oct 2019

Keywords

Human capital
Energy consumption
Cross-section dependence
Panel data

Cite this

Yao, Y., Ivanovski, K., Inekwe, J., & Smyth, R. (2019). Human capital and energy consumption: evidence from OECD countries. Energy Economics, 84, [104534]. https://doi.org/10.1016/j.eneco.2019.104534

Yao, Yao ; Ivanovski, Kris ; Inekwe, John ; Smyth, Russell. / Human capital and energy consumption : evidence from OECD countries. In: Energy Economics. 2019 ; Vol. 84.

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abstract = "We examine the effect of human capital on energy consumption for a panel of OECD economies over the period 1965–2014. Our preferred results, which account for cross-sectional dependence and structural breaks, suggest that a one standard deviation increase in human capital reduces aggregate energy consumption by 15.36{\%}. When we distinguish between clean and dirty energy consumption, we find that human capital generates significant positive externalities for the environment. Specifically, we find that a one standard deviation increase in human capital is associated with a 17.33{\%} decrease in dirty energy consumption and an 85.54{\%} increase in clean energy consumption. Our findings reinforce the social benefits of investing in human capital and suggest a promising avenue for energy conservation without impeding economic growth.",

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Yao, Y, Ivanovski, K, Inekwe, J & Smyth, R 2019, 'Human capital and energy consumption: evidence from OECD countries', Energy Economics, vol. 84, 104534. https://doi.org/10.1016/j.eneco.2019.104534

Human capital and energy consumption : evidence from OECD countries. / Yao, Yao; Ivanovski, Kris; Inekwe, John; Smyth, Russell.

In: Energy Economics, Vol. 84, 104534, 10.2019.

Research output: Contribution to journal › Article › Research › peer-review

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T1 - Human capital and energy consumption

T2 - evidence from OECD countries

AU - Yao, Yao

AU - Ivanovski, Kris

AU - Inekwe, John

AU - Smyth, Russell

PY - 2019/10

Y1 - 2019/10

N2 - We examine the effect of human capital on energy consumption for a panel of OECD economies over the period 1965–2014. Our preferred results, which account for cross-sectional dependence and structural breaks, suggest that a one standard deviation increase in human capital reduces aggregate energy consumption by 15.36%. When we distinguish between clean and dirty energy consumption, we find that human capital generates significant positive externalities for the environment. Specifically, we find that a one standard deviation increase in human capital is associated with a 17.33% decrease in dirty energy consumption and an 85.54% increase in clean energy consumption. Our findings reinforce the social benefits of investing in human capital and suggest a promising avenue for energy conservation without impeding economic growth.

AB - We examine the effect of human capital on energy consumption for a panel of OECD economies over the period 1965–2014. Our preferred results, which account for cross-sectional dependence and structural breaks, suggest that a one standard deviation increase in human capital reduces aggregate energy consumption by 15.36%. When we distinguish between clean and dirty energy consumption, we find that human capital generates significant positive externalities for the environment. Specifically, we find that a one standard deviation increase in human capital is associated with a 17.33% decrease in dirty energy consumption and an 85.54% increase in clean energy consumption. Our findings reinforce the social benefits of investing in human capital and suggest a promising avenue for energy conservation without impeding economic growth.

KW - Human capital

KW - Energy consumption

KW - Cross-section dependence

KW - Panel data

U2 - 10.1016/j.eneco.2019.104534

DO - 10.1016/j.eneco.2019.104534

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JO - Energy Economics

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Yao Y, Ivanovski K, Inekwe J, Smyth R. Human capital and energy consumption: evidence from OECD countries. Energy Economics. 2019 Oct;84. 104534. https://doi.org/10.1016/j.eneco.2019.104534

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10.1016/j.eneco.2019.104534