Dynamics and Inequalities in Energy Efficiency in China

As rapid economic growth in China in recent decades, the quality of economic growth through improvement of energy efficiency has attracted great attention. This paper evaluated energy efficiency of 29 provinces in China between 2000 and 2016 based on a global non-radial directional distance function. Moreover, the dynamics of energy efficiency were investigated using the non-radial global Malmquist-type efficiency index. The paper also sheds light on the evolution of inequalities in energy efficiency by decomposing interprovincial inequality into its within-region and between-region components. The findings of the study are as follows. First, the national energy efficiency was 0.49 in 2016, which indicated that 51% improvement could be made to reach the global technology frontier. Tianjin, Shanghai, Jiangsu, Shandong and Guangdong had the best energy efficiency in 2016, while Ningxia and Xinjiang had the lowest performance. Second, the national annual growth rate of energy efficiency was 3.4% between 2011 and 2016, which was a positive sign of energy efficiency improvement. Shandong made the biggest improvement in energy efficiency from 2011 to 2016, with 26.2% annual growth rate. Lastly, within-region inequality saw a decreasing trend after 2010 and was overtaken by between-region inequality in 2016.