Information and energy substitution in the digital economy: an empirical investigation using the input-output approach for Texas

Abstract

This paper examines the substitution of information and energy sectors in the Texas economy during the 1990s using an input-output (IO) based approach. On the basis of the analysis of three-segment Texas IO models for the years of 1990, 1994, and 1999, it is concluded that: 1) there is a trend of informatization in the state of Texas during the 1990s; 2) there exists substitution among input factors (economic segments) to produce final outputs in Texas economy. Further analyses with multiple aggregation levels at different geographical and temporal scales are needed before generalizations can be made regarding the empirical relationship between information and energy in the new digital economy.