5. Conclusions and policy implications
For a very long time, the relationship between economic development and electricity consumption has received the attentions of scholars. However, the influence of the unbalanced development between urban and rural areas on the electricity consumption per capita is largely neglected. Given China's wide urban-rural disparity and the income distribution imbalance, this paper utilizes the provincial panel data for the period of 1996e2013 to investigate whether and how the widening urban-rural income gap affects the electricity consumption per capita. The most striking conclusion of this study is that the impact of urban-rural income inequality on electricity consumption is dependent on the income level. At current stage of economic development, widening urbanrural income inequality has significant negative effects on electricity consumption per capita. Furthermore, it was found that other factors may also affect China's electricity consumption; the advancement of urbanization and industrialization and the development of foreign trade aid in increasing the electricity consumption per capita. Based on these estimation results, several important policy implications could be derived as follows:
First, the estimation results of this study suggest that the two important politic goals for sustainable economic growth, the establishment of “harmonious society” and the pursuit of “green development”, could be accomplished at once. Currently, the Chinese government should devote more effort to deepen the reform of the income distribution system and formulate more specific policies that favor rural areas to narrow the income gap between urban and rural areas. Specifically, the government should focus more on improving the efficiency of energy utilization [88], making the market play an “invisible hand” role and expanding the basic medical insurance and welfare coverage in rural areas. Through these measures, not only would the urban-rural income gap be reduced but the consumption of electricity, which is relatively cleaner energy, could also be promoted.