Estimating implicit discount rate for energy efficiency investment using the contingent valuation method: a case study in South Korea.

This study measures the implicit discount rate (IDR) for energy efficiency investment at the household level. Our pioneering attempt to use the contingent valuation method suggests fresh insights into relieving the possible problems induced when the IDR is estimated using multiple price list and open-ended questions. Using the survey data from 2392 respondents in South Korea, we measured the IDR for appliances with high energy efficiency. The measurement ranges from 21.80 to 25.94%, implying the overestimation in existing literature. This study contributes to the literature by determining the role of cognition and experience in energy efficiency investment. Cognition has a statistically significant negative impact on IDR and depends on the appliance type, whereas risk preference has no meaningful impact. Energy efficiency improvement experiences are the critical factor in reducing IDR, that is, promoting energy efficiency investment, especially for recently introduced appliances. Overall, our finding suggests that information that induces high cognition on the cost-benefit analysis and energy efficiency labeling can lower IDR and thus promote energy efficiency. Our study also suggests that targeting energy consumers who have experience in energy-saving campaigns or programs could be a priority because such experiences are crucial to IDR reduction.

The impact of official development assistance on the economic growth and carbon dioxide mitigation for the recipient countries.

The purpose of this study is to investigate the relationship between official development assistance (ODA) on CO2 emissions based on both direct and indirect frameworks, using the annual panel data of 30 recipient countries of Korea from 1993 to 2017. It employs a modified impact, population, affluence, and technology (IPAT) model and a simultaneous equation framework for the direct model and indirect model, respectively. The empirical results suggest that ODA has both a direct and an indirect mitigation impact in the recipient countries. Compared to the direct impact, a small indirect mitigation impact of ODA on CO2 emissions is derived. However, the estimation results of the environmental Kuznets curve (EKC) equation imply that economic growth has the potential of mitigating the environmental degradation when the economic development in recipient countries of Korea reaches a certain level. Therefore, the bilateral cooperation, through ODA and the supportive policy, should make an effort to promote economic development and mitigation of environmental degradation in developing countries.

Investigating the environmental Kuznets curve for Annex I countries using heterogeneous panel data analysis.

Our paper examines the environmental Kuznets curve (EKC) relationship through a heterogeneous panel analysis of 34 Annex I countries for the 1990 to 2016 period. We confirm the long-run equilibrium relationship between carbon emissions, trade openness, fossil fuel usage, and GDP through the panel cointegration tests that is robust to cross-sectional dependence. Overall, our finding is that the empirical results show no consistent evidence of the EKC hypothesis in Annex I countries via mean group and long-run estimation. Country-specific estimation shows that only 5 of the 34 countries support the EKC hypothesis. From the cointegration test to long-run vector estimation, we indirectly show that fossil fuel usage can distort the EKC results by causing endogeneity, since being strong is related to economic growth. From the synthesized statistics of empirical results, Annex I countries do not follow the EKC relationship. This could imply that because no mitigation has been achieved, climate change can become a much more serious issue, although country-specific results show that mitigation is constantly in progress.

A comparative study of energy and carbon efficiency for emerging countries using panel stochastic frontier analysis.

The demand for energy has been increasing significantly worldwide. Consequently, carbon emissions have accelerated, since energy usage involves carbon dioxide. Given that the available energy has quantitative restriction feature, efficient usage of energy becomes crucial. Energy efficiency is expected to improve over time with technological advancements. However, the adoption of low-carbon energy technology caused by the growing concern about carbon emissions may actually offset energy efficiency, owing to the higher cost compared with traditional energy methods. We conducted a stochastic frontier analysis to examine energy efficiency in the views of both economic and ecological aspect view during 1995-2016 for 21 emerging countries selected from Morgan Stanley Capital International, using energy consumption, economic complexity index and the other factors of production based on the Cobb-Douglas production function. Mexico was identified as one of the most energy-efficient countries; however, Mexico could not be classified as real energy efficient, as it demonstrated the highest carbon inefficiency level. We also categorized countries demonstrating increased economic energy efficiency and decreased carbon inefficiency as frontier country, and identified six such countries.