Biomass Energy Use, Price Changes and Imperfect Labor Market in Rural China: An Agricultural Household Model-Based Analysis.

Transcription

1 Bomass Energy Use, Prce Changes and Imperfect Labor Market n Rural Chna: An Agrcultural Household Model-Based Analyss by Qu Chen Junor Researcher Department of Economc and Technologcal Change Center for Development Research (ZEF), Unversty of Bonn 15 th IAEE European Conference rd to 6 th September 2017, Hofburg Congress Center, Venna, Austra

2 Introducton Bomass energy s an mportant energy source used n developng countres, accountng for 35% of ther energy supply (Demrbas and Demrbas, 2007). The tradtonal use of bomass energy nvolves detrmental mpacts on human health and neffcent labor allocatons (Chen et al., 2006; Zhang et al., 2010). The wdespread use of clean and more effcent bofuels based on modern technologes could sgnfcantly mprove rural lvng standards (Zhang et al., 2009; Gosen et al, 2013). 2

3 Introducton Bomass energy consumpton Energy transton Bomass energy choce Bomass collecton Agrcultural producton Prces Source: Author s own conceptualzaton 3

4 Problem Statement Household usually plays a double role of producer and consumer of domestc bomass energy (Amacher et al., 1996; Heltberg et al., 2000; Mshra, 2008). Most research only takes nto account the drect effects of exogenous prce changes on both consumpton and producton of bomass energy. However, the ndrect effects jontly concernng household consumpton, producton and labor allocaton decsons for bomass energy use are rarely consdered 4

5 Research Queston Do the prce changes n exogenous markets (ncludng energy market, labor market, and agrcultural products market) affect household bomass energy use? 5

6 Data & Samplng Data were obtaned from a household survey conducted from August 2013 to February 2014 n Schuan Provnce. Sx countes were selected. Three towns, each wth two vllages were randomly selected from each county. In every vllage, respondents were randomly ntervewed. Geographc dstrbuton of samples Totally, the number of the surveyed households s of them are typcal agrcultural households. 6

7 Conceptual framework Commercal energy market An Agrcultural Household L a L b L o l Home producton Other market (exogenous) Agrcultural producton Bomass collecton Labor market Source: Author s own conceptualzaton 7

8 Theoretcal background Basc assumpton: labor market s the only one market that could be constraned. A test for separablty usng Fnte Mxture Model (FMM) confrmed that all housholds behave under the nonseparable assumpton n the labor market. 8

9 Theoretcal background A non-separable agrcultural household model s developed to obtan the total effects of prce changes on household bomass energy use (n elastcty form): E( C b p x ) G E( C b p x ) H E( w * p x )[ E( C b w * ) H S b l ] (1) Drect response of bomass energy consumpton to a change n the exogenous prces Indrect effect va the endogenous varaton n the shadow wage nduced by the exogenous shock Where, C b s the consumpton of bomass energy; p x s exogenous market prce; w* s the shadow wage of household labor; θ b s the full ncome elastcty of bomass energy consumpton; and S l s the share of lesure consumpton n shadow full ncome (budget). 9

10 Emprcal Strategy Two-step emprcal strategy s used: Step 1. Shadow wage estmaton Cobb-Douglas multoutput producton functon system (Kumbhakar, 2011) Step 2. Jont analyss of consumpton, producton and labor allocaton decsons 10

11 Emprcal Strategy Step 2.1 Household consumpton decson Lnear Approxmaton of the AIDS (LA/AIDS) model (Deaton and Muellbauer, 1980): ES constraned to 1 0 ; ; (3) j 0 j j j ln( p j ) ln * j P Y Where ES denotes the expendture share of -th commodty category; Y ndcates shadow full ncome; p j denotes the consumer prce of commodty category j; P * s the Stone s prce ndex; a n refers to household characterstcs. n a n n (2) 11

12 Emprcal Strategy Step2.2 Household labor allocaton decson A system of translog proft functon wth labor cost share equatons (Schneder, 2011): ln TC LS ln p 0 c 1 2 j c j ln w* w j ln( ) ln( ) p p p ln p j ln Y y constraned to: 1 ; j 0 ; j j (6) j Where, TC : total cost; Y p : total value of output; p /p j : prces of nputs (.e. the market wage rate w, shadow wage rate w*, and weghted prce of ntermedate nputs p c ); LS : cost share of labor nputs (.e. labor n home producton and off-farm employed labor). P (4) (5) 12

13 Table 2. Estmated elastctes Estmaton results Full ncome elastcty Self-consumed agrcultural products Bomass energy Wth respect to the prce of Commercal energy Labor (shadow wage rate) Other purchased goods Labor (market wage rate) Consumpton Self-consumed agrcultural products Bomass energy Commercal energy Lesure Other purchased goods Labor Supply Home producton Off-farm employment Source: Estmaton results of LA/AIDS model and the system of proft functon wth cost share equatons 13

14 Fndngs Table 3. Identfed sgns of the effects Self-consumed agrcultural products Wth respect to the external prce of Commercal energy Other purchased goods Labor Indrect effect Drect effect Total effect

15 Conclusons The exogenous prce changes have postve drect effects on household bomass energy use. Neglectng the ndrect effects of shadow wages and consderng only drect prce effects wll lead to naccurate fndngs about household bomass energy producton and consumpton behavors. 15

16 Thanks for your attenton! 16