Real estate investment and energy efficiency: Evidence from China's policy experiment

The Chinese government conducted a policy experiment on real estate-led economic growth on such a massive scale, which is unprecedented. This paper empirically analyzes the impact of real estate investment on energy efficiency. Provincial level panel data of China during 2004-2012 was used for the analysis. Two-way Fixed Effect model was applied to test the impact of real estate investment on total-factor energy efficiency (TFEE). The findings in this paper are: a certain degree of the real estate-led model of economic development can improve TFEE of the economy. Developing countries can gain economic development and energy efficiency improvement simultaneously by developing the real estate industry to a certain extent. But the impact of real estate investment on TFEE exhibits a nonlinear characteristic, that is, when the real estate investment proportion exceeds the threshold value, the impact of real estate investment on TFEE will take a reversal; Except Beijing, Shanghai, Hainan and Zhejiang provinces, to some extent, improving real estate investment can be helpful to improve TFEE in most of China's provinces. (C) 2019 Elsevier Ltd. All rights reserved.