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Natalie Brown
Kshithij Shrinath
Kenyon Smutherman
$74000
552 kWh
$9300
259 kWh
$1400
2400 kWh
How does a country’s level of economic development affect its renewable energy production?
LinearInverse U-shaped
Developing countries produce moreU-shaped
Developing countries produce less
Low/middle-income - vulnerability to climate change
High-income - energy stabilityOil price increases and volatilitySupply-side factors
Benefits difficult to quantifyHigh fixed and initial capital costs
Urbanizing countries tend toward fossil fuelsFinancing mechanisms unavailable in low-
income and middle-income countriesHigh-income countries entrenched in fossil
fuelsUS $41 billion in subsidies to oil and gas
From the World Development IndicatorsIndependent variable: log GDP per capita
(PPP) in constant 2005 US$Dependent variable: electricity produced
from renewable sources (kWh) per capita (includes nuclear)
1990 to 20092519 observations from 131 countries
Simple regressionCountry and year fixed-effectsGeography – land area, forest area,
agricultural landPopulation – density, rural percentageTrade – imports/exportsPolitical indicators - European Union, OECD,
regime type
Note the coefficients
Linear and U-shaped hypotheses significant at 1% level throughout all models
Linear more correct from descriptive dataU-shape only in underdeveloped categoryDeveloped countries significantly outpace
othersDeveloping similar level to underdeveloped
Renewable energy is a normal goodFairly intuitive
Underdeveloped and developing countries in trouble33% of greenhouse gas usage, 75% of damageAdaptation more practical than mitigation
Internalize the social costs of fossil fuels and social benefits of renewable energyCorrect the externality
We Are (Intercultural and Environmentally Conscious) Georgetown!