The Impact of Energy Efficiency Gains on Output with Computable General Equilibrium Model

Abstract

This paper explores the inter-relationships between increased energy efficiency and other factors related to energy efficiency in economic system by using the causal-loop diagram which systematic dynamic method provided. Then, through establishing a computable general equilibrium model that considering the different industry departments with labor, capital and energy input, we measure the impact of increased energy efficiency on all production sectors. The results show that the economic output is quite different when energy efficiency grows, and both heavy industry and the construction industry get an obvious growing output, while agriculture, light industry, service industry and transportation industry have a little influence.