The Effect of Energy Aggregation on Energy Elasticities: Some Evidence from U.S. Manufacturing Data

Measuring energy input plays an important role in many empirical studies, such as analyses of energy demand, efficiency, and productivity. Yet energy is a complex concept and difficult to measure. As a result, energy studies have used energy aggregates constructed based on different aggregation methods. Different aggregates could lead to significantly different results, thus affecting the evaluation of alternative energy policies as well as other economic inferences.