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!