Driving factors of changes in energy intensity: A comparison between energy exporting and importing countries

This paper compares the driving factors of changes in energy intensity in both net energy exporting and importing countries using a DEA-Malmquist (Data Envelopment Analysis) and panel GMM (Generalized Method of Moments) methods over the period of 2000-2021. The findings show that technological progress has played a significant role in reducing of energy intensity in both groups. Moreover, we use the DEA method to decompose the Malmquist total factor productivity (TFP) into its components including technical change (TC), efficiency change (EC), pure efficiency change (PEC) and scale efficiency change (SEC). The results show that in energy exporting countries, the effects of each of these TFP components on energy intensity are negative but relatively weak, while the effects of these components on reducing energy intensity in importing countries is considerable. Specifically, the estimated coefficient of the pure efficiency component in reducing energy intensity in very remarkable, which shows the high importance of the efficiency components of TFP in energy management. Next, we investigate what is the main driver of technological progress in both the energy exporting and importing countries. The findings imply that in net energy exporting countries trade openness is a dominant factor to improve productivity, while in net energy importing countries, internal R&D is the dominant factor for improving technological efficiency.