Study on China's Energy Demand Ridge Regression Prediction Based on Path Analysis

Energy demand system is a complex system, which is affected and controlled by many factors and external environmental in its development and evolution process. This paper selected the prediction method of correlation, in the way of literature review at first, preliminary qualitatively choose factors which influence the energy demand. Then the direct, indirect and total effect degree of each factor on energy demand were measured by the method of path analysis. On the basis of path analysis, used ridge regression to eliminate multicollinearity to forecast China's energy demand, the prediction accuracy is high, and its practicability in this model is good.