Energy Economics

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             To conclude with, the IEO's report highlights an impressive increase in terms of energy demand, a trend which will result in both negative environmental effects and a scarcity of natural resources.
             2. The link between economic growth and energy use
             Many debates on energy themes focus on the relationship between consumption and economic growth. For some years, analysts asserted that an increasing GDP generated a higher energy use. Yet, it was discovered that such assertion didn't apply to all countries and, therefore, it must be customized according to the development stage undergone by the respective nations. Consequently, analysts have inferred that, for low and medium income countries, the energy use equals or outpaces the economic growth rate due to people's "hunger" for home appliances, shopping centers, malls and other similar miracles of the civilized world. On the other hand, high income countries are said to consume less because they afford to implement environmentally cleaner technologies and to extend the service sector which uses less energy than industry. Two eloquent examples, in this regard, are Germany whose per capita energy use and carbon dioxide emissions dropped by 11% and 20%, respectively, between 1980 and 1992, and USA which reported a 6% decrease in carbon dioxide emissions and a stable energy use, during the same period (The World Bank Group, 2000).
             The nature of the link above depicted is also backed up by IEO's findings. According to these, the OECD nations have a weak link as the energy demand is far beyond the economic growth due to stable or less changeable per capita use. At the antipode of the category earlier described, one could mention the non-OECD countries which boast a much stronger relationship. The only exceptions to the rule are the non-OECD Europe and Eurasia regions where, after an energy use exceeding the GDP until 1990, the income rate and consu...

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