Where pg is the weight of group g in global GDP; Tg denotes energy intensity
inequality within group g ; eg represents group g energy intensity; e is the world
average energy intensity.
The first term —the intra-group component (Twithin)— is a weighted average of
intra-groups Theil indexes. Therefore, a multiplicative decomposition is
straightforward according to (5). The second term —the inter-group component
(Tbetween)— is simply a Theil index evaluating differences among groups. So, the
previous multiplicative bifactorial decomposition of equation (5) is also
straightforward. Therefore, for the regional analysis we will first apply a
decomposition according to equation (6) and at a second stage a
decomposition on the basis of equation (5) for each of the inequality
components obtained in the first stage.
3. Empirical findings
The data used for the analysis are the energy balances from the International
Energy Agency (IEA, 2009a, 2009b). The selected sample includes 116
countries and basically covers the entire world GDP and primary and final
energy. For consistency reason, over the entire period we group the countries
of the former USSR and also those of the former Yugoslavia. For the countries
considered in the analysis per group (whose results are contained in Table 5),
we use the IAE classification as a reference. The classification is done
according to economic and geographic criteria and considers the following nine
world regions: OECD Europe, non-OECD Europe, North America, OECD
Pacific, Africa, Latin America, Middle East, Asia and China. Annex 1 gives a
detail of the countries included in each group. Table 1 below gives an overview
of the statistics of the sample used and for the different regions considered in
the analysis.