Energy consumption and economic growth in the light of meeting the targets of energy policy in the EU: The bootstrap panel Granger causality approach

Śmiech, Sławomir; Papież, Monika

doi:10.1016/j.enpol.2014.04.005

Cited by 90 publications

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References 64 publications

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“…(iv) The neutral effect indicates that electricity consumption does not lead economic growth and vice versa. This hypothesis is empirically confirmed by Yu and Hwang (1984), Chontanawat et al (2008), Wolde-Rufael (2009) and Smiech and Papiez (2014).The conservation and neutral hypotheses reveal minor (or no) role of electricity consumption in promoting economic growth. In such circumstances, energy (electricity) conservation policies are suitable because they have no adverse effect on economic growth.…”

Section: Electricity Consumption and Economic Growthsupporting

confidence: 55%

Dynamics of electricity consumption, oil price and economic growth: Global perspective

et al. 2017

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Abstract:This study uses the data from 157 countries from 1960 to 2014 to analyze the relationship between economic growth, electricity consumption, oil prices, capital, and labor. The economic growth of developing countries with industrial infrastructure has a more significant association with electricity consumption than oil prices. We use oil prices and electricity consumption jointly to study highly predictive observations for economic growth. The data are categorized by income, OECD and regional levels. The panel cointegration, long-run parameter estimation, and Pool Mean Group testsare used to analyze the cointegration and short-run and long-run relationships between the variables. The empirical results indicate the presence of cointegration between the variables. The presence of feedback effects between electricity consumption and economic growth, oil prices and economic growth is valid. These findings confirm that inspite of the oil prices, developing countries rely heavily on electricity consumption for economic growth. In the short run, growth and feedback effects suggest that more vigorous electricity policies should be implemented to attain sustainable economic growth for the long-term.

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Section: Electricity Consumption and Economic Growthsupporting

confidence: 55%

Dynamics of electricity consumption, oil price and economic growth: Global perspective

et al. 2017

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“…4 A focus on this country will be presented in Section 3. Smiech and Papiez 2014). These results seem to diverge based on the countries, periods or methods used.…”

Section: Introductionmentioning

confidence: 89%

Energy consumption, financial development and economic growth in India: New evidence from a nonlinear and asymmetric analysis

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This paper investigates the asymmetric relationship between energy consumption and economic growth by incorporating financial development, capital and labour into a production function covering the Indian economy from 1960Q 1 -2015Q 4 . The nonlinear autoregressive distributed lag bounds testing approach is applied to examine the asymmetric cointegration between the variables. An asymmetric causality test is also employed to examine the causal association between the considered variables. The results indicate cointegration between the variables in the presence of asymmetries. The asymmetric causality results show that only negative shocks in energy consumption have impacts on economic growth. In the same vein, only negative shocks in financial development have impacts on economic growth. By contrast, symmetrically, capital formation causes economic growth. Finally, over the study period, a neutral effect exists between the labour force and economic growth in India. The implications of these results for growth policies in India are also discussed.Keywords: Financial Development, Energy, Growth, India, Asymmetries JEL classification: O13 Acknowledgements: We would like to thank the editor, Professor Richard Tol (University of Sussex, Brighton, UK), as well as the three anonymous reviewers, for their valuable comments and suggestions that helped us improve our paper significantly. We also thank the participants at the 7 th International Research Meeting in Business and Management (IPAG, Nice, France, 11-12 July 2016). We are also grateful to Jawad Kazmi for his technical assistance. The authors' are responsible for any remaining errors or shortcomings. IntroductionThis study uses quarterly data to investigate the relationship between energy consumption and economic growth in India over the 1960-2015 period. Financial development (measured by domestic credit to the private sector), 1 capital formation and labour force 2 are also included in the Cobb-Douglas production function. This study's main contribution to the existing literature on the energy-growth nexus concerns its examination of the potential asymmetric relationship between the variables. Taking this asymmetry into account is important because a positive or negative variation on one variable does not have the same impact on the other variable. The existence of an asymmetric relationship between two variables can be caused by numerous factors, one of which concerns the complexity of economic systems and the mechanisms that generate the variables under study. This complexity may induce various channels through which one variable affects another. In our case, the relationship between energy consumption and economic growth has been found to be very complex because previous studies have shown four possible impact channels: the growth, conservative, feedback and neutrality hypotheses. 3 On the one hand, the relationship between energy consumption and financial development can also be very complex because numerous impact channels can exist between them...

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“…Fourth, the neutrality hypothesis does not consider any causal relationship between electricity consumption and economic growth. Hence, the neutrality hypothesis suggests that electricity consumption plays a limited role in the economic growth of a given country (e.g., Wolde-Rufael 2009, Smiech andPapiez 2014). In this case, any increase or decrease in electricity consumption has no effect on the economic output.…”

Section: Introductionmentioning

confidence: 99%

Production function with electricity consumption and policy implications in Portugal

et al. 2017

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Using a sample of quarterly data, we investigate the effect of electricity consumption, capital formation and financial development on economic growth in Portugal. A positive (negative) shock of electricity consumption is estimated to have increased (decreased) economic growth. Economic growth is positively affected by positive shock stems in capital. A positive (negative) shock in financial development declines (increases) economic growth. These findings reveal that (a) Portugal is still an energy-dependent economy; (b) energy is one of the major inputs for economic growth and development; (c) a conservation energy policy should not be implemented because energy is an important driver of growth; (d) economic growth enhances capital formation and not the opposite. Hence, it appears more relevant to boost economic growth before enhancing capital formation; (e) financial development does not appear to be an important catalyst for economic growth. Findings also highlight (f) the relevance of the recent energy policy implemented in Portugal and (g) the need to limit energy imports by means of producing electricity through renewable energy to reduce the external debt level in Portugal, especially after the 2008 crisis.

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Energy consumption and economic growth in the light of meeting the targets of energy policy in the EU: The bootstrap panel Granger causality approach

Cited by 90 publications

References 64 publications

Dynamics of electricity consumption, oil price and economic growth: Global perspective

Dynamics of electricity consumption, oil price and economic growth: Global perspective

Energy consumption, financial development and economic growth in India: New evidence from a nonlinear and asymmetric analysis

Production function with electricity consumption and policy implications in Portugal

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