Effects of Energy Efficiency on Firm Productivity in Kenya’s Manufacturing Sector

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dc.contributor.authorMacharia, Kenneth Kigundu
dc.contributor.authorNgui, Dianah
dc.contributor.authorGathiaka, John Kamau
dc.date.accessioned2022-10-25T07:27:27Z
dc.date.available2022-10-25T07:27:27Z
dc.date.issued2022-03-22
dc.descriptionA Research Article in the Journal of Sustainable Developmenten_US
dc.description.abstractThere is concern about probable energy efficiency and economic performance trade-off, particularly in developing countries which often require more energy consumption to spur their economies. This study assesses the relation between energy efficiency and total factor productivity in Kenya’s manufacturing sector by applying a sample of firms in the World Bank Enterprise Survey. Energy intensity is used as a proxy for energy efficiency while total factor productivity is estimated using the Levinsohn-Petrin Algorithm. A dynamic panel data model is applied in the analysis of the energy efficiency and total factor productivity relationship which is at the sub-sector and firm size levels. The sub-sectors of concern are: chemicals, pharmaceuticals and plastics, food, textile and garments and paper and other manufacturing sub-sectors. Firm sizes of interest are: small, medium and large. The findings show heterogeneity in energy intensity across sub-sectors. Total factor productivity is also found to be heterogeneous across sub-sectors and firms of different sizes. The estimates show that in general, energy efficiency significantly promotes total factor productivity. Other factors that promote total factor productivity include capital intensity, age, size, top manager’s years of experience, foreign ownership and exporting status. However, the effect of these variables varies across the sub-sectors and firm sizes. The study findings suggest that policies to improve energy efficiency should be accorded additional emphasis jointly with improvements in total factor productivity.en_US
dc.description.sponsorshipAfrican Economic Research Consortium (AERC)en_US
dc.identifier.citationMacharia, K. K., Ngui, D., & Gathiaka, J. K. (2022). Effects of Energy Efficiency on Firm Productivity in Kenya’s Manufacturing Sector. Journal of Sustainable Development, 15(3), 1-90.en_US
dc.identifier.issn1913-9063
dc.identifier.issn1913-9071
dc.identifier.urihttp://ir-library.ku.ac.ke/handle/123456789/24351
dc.language.isoenen_US
dc.publisherCanadian Center of Science and Educationen_US
dc.subjectEnergy efficiencyen_US
dc.subjectTotal factor productivityen_US
dc.subjectManufacturing sectoren_US
dc.titleEffects of Energy Efficiency on Firm Productivity in Kenya’s Manufacturing Sectoren_US
dc.typeArticleen_US
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