Estimating the International GNP-Energy Relation: A Further Note

Energy enhances the productivity of capital, labor, and other factors of production, and generally promotes higher living standards. International cross-sectional studies of aggregate output per capita are often hampered by the absence of qualitatively comparable capital and labor services. And numerical measures of cross-country differences in technology are notoriously scarce, primarily because technological differences (at a macro level) are a pretty vague concept. Thus, it is often desirable to draw a simple relationship between broad international aggregates such as GNP and energy per capita.