The Relationship between Major Oil Products Consumption and Efficiency of Industry Sector in Selected Oil Exporting and Importing Countries

Journal Name:

Publication Year:

Abstract (2. Language): 
The aim of this study is to investigate the realization of the law of diminishing returns in usage of major oil products in the industry sector of some oil exporting and importing countries during 2002- 2008. To achieve this aim, in a first stage the efficiency of industry sector of countries has been calculated using DEA window analysis and then in the second stag the existence of an inverted U' shape relationship between major oil product consumption and efficiency has been tested in the context of dynamic panel data (GMM) approach. The results confirm this relationship in each group of countries except that the turning point in the case of oil importing countries is much higher than oil exporting countries. This firstly suggests that oil dependence in oil importing countries is more than oil exporting countries and secondly indicates that the industry sector of oil importing countries have advanced technology and high scale and capacity so that they can take benefits of oil products consumption without decrease in efficiency.

JEL Codes:



Abosedra, S., Baghestani, H., (1991). "New evidence on the causal relationship between
United States energy consumption and gross national product." Journal of Energy and
Development 14, 285–292.
The Relationship between Major Oil Products Consumption...
EJBE 2013, 6 (12) Page | 111
Akarca, A.T., Long, T.V., (1980). "On the relationship between energy and GNP: A
reexamination." Journal of Energy and Development 5, 326–331.
Al-Eraqi A.S., Mustafa A. and Tajudin Khader A. (2010). "An extended DEA windows analysis:
Middle west and east African seaports." Journal of Economic Studies, 37(2), 115-139.
Al-mulali, U. (2011). "Oil consumption, CO2 emission and economic growth in MENA
countries." Energy, 36(10):6165-6171.
Allen SL. (1979). "Energy and economic growth in the United States." Cambridge (MA): MIT
Arellano, M, & Bond.S., (1991). "Some tests of specification for panel data: Monte Carol
evidence and application to employment equation." Review of Economic Studies, 58(2).
Arellano, M. and O. Bover (1995). "Another look at the instrumental variable estimation of
error-components models." Journal of Econometrics 68, 29-51.
Arellano, M., (1988)." An Alternative Transformation for Fixed Effects Models with
Predetermined Variables." Applied Economics Discussion Paper, nº. 57, University of Oxford,
Arellano, M., Bond, S., (1998)." Dynamic Panel Data estimation using DPD98 for GAUSS,
Mimeo." Institute for Fiscal Studies, London.
Asmild, M., Paradi, J., Aggarwal, V., Schaffnit, C., (2004). "Combining DEA window analysis
with the malmquist index approach in a study of the Canadian banking industry." Journal of
Productivity Analysis 21: 67–89.
Apergis, N., & Payne, J. E. (2010). "The causal dynamics between coal consumption and
growth: Evidence from emerging market economies." Applied Energy, 87(6):1972-1977.
Baltagi, B. (2008). "Econometric Analysis of Panel Data." 5th Edition. John Wiley & Sons
publication .
Banker, R.D., Charnes, A., Cooper, W.W., (1984). "Models for estimation of technical and
scale inefficiencies in data envelopment analysis." Management Science 30, 1078–1092.
Barro, R.J. and J.W. Lee. (1996). "International measures of schooling years and schooling
quality." American Economic Review, 86, 218-23.
Bartleet, M., & Gounder, R. (2010). "Energy consumption and economic growth in New
Zealand: Results of trivariate and multivariate models." Energy Policy, 38(7):3508-3517.
Berndt, E.R., Wood, D.O. (1975). "Technology, prices and the derived demand for energy."
American Economic Review 56: 259–268.
Berndt SR, Wood DO. (1979). "Engineering and econometric interpretations of energy–
capital complementarity." Am Econ Rev 69:342–354.
Blundell, RW, Bond, SR (1998). "Initial conditions and moment restrictions in dynamic panel
data models." Journal of Econometrics 87: 115–143
Charnes, A., Cooper, W.W., (1985). "Preface to topics in data envelopment analysis." Annals
of Operations Research 2, 59–94.
Cooper WW, Seiford ML, Tone KA (2007). "Data Envelopment Analysis. A comprehensive text
with models, Applications, References and DAE-Solver software." Second edition.
Cottrell WF. (1955). "Energy and society: the relation between energy, social change and
economic development." New York: McGraw Hill
Ali Akbar Naji MEIDANI, Mohammad Ali FALAHI & Seyyed Mohsen Seyyed Agha HOSSEINI
Page | 112 EJBE 2013, 6 (12)
Cullinane, K., Song, D. W., Ji. P. and Wang. T. F. (2004). "An Application of DEA Windows
Analysis to Container Port Production Efficiency." Review of Network Economics 3(2): 184-
Griffin, J.M., Gregory, P.R. (1976). "An intercountry translog model of energy substitution
responses. American Economic Review 66: 845–847.
Halkos, G. E., & Tzeremes, N. G. (2011). "Oil consumption and economic efficiency: A
comparative analysis of advanced, developing and emerging economies." Ecological
Economics, 70(7), 1354-1362.
Halkos, G., Tzeremes, N.G., (2009a). "Exploring the existence of Kuznets curve in countries'
environmental efficiency using DEA window analysis." Ecological Economics 68, 2168–2176.
Halkos, G., Tzeremes, N.G., (2009b). "Electricity generation and economic efficiency: Panel
data evidence from World and East Asian Countries." Global Economic Review 38, 251–263.
Hemmasi, A., Talaeipour, M., Khademi- Eslam, H., Farzipoor Sean, R. & Pourmousa, S. H.,
(2011). "Using DEA window analysis for performance evaluation of Iranian wood panels
industry." African Journal of Agricultural Research, 6(7), 1802-1806.
Hudson SA, Jorgenson DW.(1974). "US energy policy and economic growth, 1975–2000." Bell
J Econ Manage Sci 5:461–514.
International Energy Agency. http://data.iea.org
Jorgensen, Dale W., Wilcoxen, P., (1990). "Environmental regulation and U.S. Economic
Growth." The Rand Journal of Economics 21(2):314–330.
Kraft, J., Kraft, A., (1978). "On the relationship between energy and GNP." Journal of Energy
and Development 3, 01–403.
Pokrovski, V. N. (2003). "Energy in the theory of production." Energy 28(8): 769-788.
Roodman, D. (2007). "A Short Note on the Theme of Too Many Instruments." Center for
Global Development Working Paper No. 125.
Smulders, S., de Nooij, M., (2003). "The impact of energy conservation on technology and
economic growth." Resource and Energy Economics 25:59–79.
Soytas, U., Sari, R., (2009). "Energy consumption, economic growth, and carbon emissions:
challenges faced by an EU candidate member." Ecological Economics 68, 1667–1675.
Soytas, U., Sari, R., Ewing, B.T., (2007). "Energy consumption, income, and carbon emissions
in the United States." Ecological Economics 62, 482–489.
Tulkens, H., Vanden Eeckaut, P., (1995). "Non-parametric efficiency, progress and regress
measures for panel data: methodological aspects." European Journal of Operational
Research 80, 474–499.
Warr, B., Ayres, R., (2006). "REXS: a forecasting model for assessing the impact of natural
resource consumption and technological change on economic growth." Structural Change
and Economic Dynamics 17:329–378.
Yu, E.S.H., Choi, J.Y., (1985). "The causal relationship between energy and GNP: An
international comparison." Journal of Energy and Development 10, 249–272
Zhang, X.P., Cheng, X.M., (2009). "Energy consumption, carbon emissions, and economic
growth in China." Ecological Economics 68, 2706–2712.

Thank you for copying data from http://www.arastirmax.com