Impacts of global manufacturing transfer on energy intensity, consumption, and transition: An industry linkage perspective

Abstract

Manufacturing industry consumes a substantial amount of energy, and its international transfer plays a crucial role in shaping energy consumption patterns worldwide. However, the energy impacts of manufacturing transfer, particularly with regard to energy transition, have not been fully investigated. We present a theoretical framework based on industry linkage to elucidate the energy impacts of global manufacturing transfer. Subsequently, we empirically examine the energy impacts as well as the underlying mechanisms using panel data encompassing 43 countries from 2003 to 2017. Results show that global manufacturing transfer significantly increases overall energy consumption, decreases energy intensity, and promotes the transition torwads low-carbon energy system. Specifically, it decreases energy intensity in both the originating and receiving countries, promotes the low-carbon energy transition in the originating countries, but has no notable impact on the energy transition in the receiving countries. The energy effects are more pronounced in developed countries and in the post-financial crisis period.