Abstract Based on the capital-energy-labor nested CES production function, this paper analyzes energy intensity effect of biased technical change induced by international trade. When trade causes the technological change biased towards capital, it could reduce energy intensity by decreasing the energy relative factor share. Combined with China’s 36 industrial sectors data from 1995 to 2017, it examines this effect. Using the normalized supply side system method, we also measure the direction of technical change, identify the mechanism of the energy intensity effect of biased technical change induced by trade. The results show that biased technical change caused by trade could reduce energy intensity significantly through the effect on energy relative factor share. However, for the sectors of different openness, industries and competitiveness, the energy intensity effect differs evidently. The technical change of whole industry is biased towards capital, which is the main reason why international trade reduces energy intensity. The research not only provides new sights for understanding the change of China’s industrial energy intensity, but also gives the policy reference of decreasing industrial energy intensity.
2020, Vol. 37 
