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The External Performance Appraisal of China Energy Regulation: An Empirical Study Using a TOPSIS Method Based on
Zheng-Xin Wang1,2, Dan-Dan Li3, Hong-Hao Zheng4
1School of Economics, Zhejiang University of Finance & Economics, Hangzhou 310018, China. zxwang@zufe.edu.cn.
An improved entropy weight and Mahalanobis distance-based technique for order preference by similarity to an ideal solution (E-M-TOPSIS) effectively appraises China's energy regulation performance. This method accounts for index correlations, offering more stable and realistic results than traditional approaches.
Area of Science:
- Environmental Science
- Economics
- Energy Policy
Background:
- Effective energy and environmental regulation is crucial for sustainable development in China's industrialization.
- Traditional methods for evaluating energy regulation performance may not fully capture complex interdependencies.
- Understanding externalities of energy consumption is key to balancing economic growth and environmental protection.
Purpose of the Study:
- To introduce an improved Technique for Order Preference by Similarity to an Ideal Solution (E-M-TOPSIS) incorporating entropy weight and Mahalanobis distance.
- To empirically evaluate the external performance of China's energy regulation from 1999-2015 using both traditional and E-M-TOPSIS methods.
- To compare the results of the improved E-M-TOPSIS with traditional TOPSIS, highlighting the impact of considering index correlations.
Main Methods:
- Development of an improved Technique for Order Preference by Similarity to an Ideal Solution (E-M-TOPSIS) using entropy weight and Mahalanobis distance.
- Empirical analysis of China's energy regulation external performance (1999-2015) using traditional TOPSIS and the proposed E-M-TOPSIS.
- Comparative assessment of appraisal results, focusing on the influence of inter-index correlations on performance evaluation.
Main Results:
- The E-M-TOPSIS method, by accounting for index correlations, provides a more nuanced appraisal compared to traditional TOPSIS.
- E-M-TOPSIS softens the closeness degree and leads to smaller fluctuations in relative closeness, aligning better with practical energy regulation conditions.
- External economic performance shows higher volatility than social responsibility performance (environmental and energy safety), indicating greater sensitivity to energy regulation.
Conclusions:
- The E-M-TOPSIS is a robust and applicable method for evaluating the external performance of energy regulation.
- Considering the correlation between performance indexes is essential for accurate and realistic assessment.
- Energy regulation significantly impacts economic performance, while social responsibility performance remains relatively stable.
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