Citation

Edziah, Bless Kofi and Huaping, Sun and Anyigbah, Emmanuel and Gyamfi, Bright Akwasi and Asongu, Simplice A. (2026) Energy efficiency in times of geopolitical uncertainty: A global analysis across income levels. Energy Efficiency, 19 (1). ISSN 1570-646X

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Abstract

Macroeconomic uncertainties—such as political risk and economic policy instability—have been widely examined in relation to energy transition, security, and environmental performance. However, their impact on energy efciency remains underexplored. A key question emerges: do geopolitical risks impede energy efciency or do they compel governments to enhance efciency and reduce import dependence? This paradox calls for empirical investigation. While recent studies suggest that geopolitical threats may still improve energy efciency in Europe due to their advanced infrastructure and technological capacity, it is unclear whether these fndings hold globally and how outcomes difer across income groups. To address this gap, we employ a news-based geopolitical risk index and endogenous stochastic frontier analysis (SFA) to provide a comprehensive global assessment across income levels and time periods for 1985–2022. The results show that geopolitical risks signifcantly increase global energy ineffciency, with low-income countries most severely afected. However, evidence indicates that, over time, countries may adapt by improving efciency and diversifying energy sources. Counterfactual scenarios analysis further demonstrates that reducing geopolitical risks could lower global energy inefciency by at least 13%. These fndings highlight the importance of policies that both mitigate geopolitical risks and strengthen the resilience of energy systems worldwide.

Item Type:	Article
Uncontrolled Keywords:	Energy efciency
Subjects:	Q Science > QC Physics > QC221-246 Acoustics. Sound
Divisions:	Faculty of Management (FOM)
Depositing User:	Ms Rosnani Abd Wahab
Date Deposited:	07 Jan 2026 02:12
Last Modified:	07 Jan 2026 08:12
URII:	http://shdl.mmu.edu.my/id/eprint/15159

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