In China, between 1978 and 1995, energy use per unit of GDP fell by 55 perc
ent. There has been considerable debate about the major factors responsible
for this dramatic decline in the energy-output ratio. In this paper we use
the two most recent input-output tables to decompose the reduction in ener
gy use into technical change and various types of structural change, includ
ing changes in the quantity and composition of imports and exports. In perf
orming our analysis we are forced to deal with a number of problems with th
e relevant Chinese data and introduce some simple adjustments to improve th
e consistency of the input-output tables. Our main conclusion is that betwe
en 1987 and 1992, technical change within sectors accounted for most of the
fall in the energy-output ratio. Structural change actually increased the
use of energy. An increase in the import of some energy-intensive products
also contributed to the decline in energy intensity.