A PANEL DYNAMIC ANALYSIS ON ENERGY CONSUMPTION, ENERGY PRICES AND ECONOMIC GROWTH IN NEXT 11 COUNTRIES

Jannatul Ferdaus,Anouba Acha Arnaud Martial,Bismark Kusi Appiah,Shapan Chandra Majumder

doi:10.32479/ijeep.9880

Jannatul Ferdaus, Anouba Acha Arnaud Martial + Show 2 more

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https://doi.org/10.32479/ijeep.9880

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Abstract

This study empirically examines the impacts of energy consumption and energy prices on economic growth for three data sets of panel groups of Next 11 countries within a multivariate panel framework over the period 1990-2013. For the entire panel group of Next 11 countries, it is obtained from the results of panel Autoregressive Distributed Lag estimation approach that, energy consumption has a positive and energy prices have a negative impact on economic growth, both in the long-run and short-run; and a unidirectional causal linkage between economic growth and energy consumption is confirmed by the results of panel causality tests. For the 6 of Next 11 net oil-importing countries panel group, it is found from panel Dynamic Ordinary Least Squares method that, economic growth is negatively influenced by both energy consumption and energy prices. The results of panel Autoregressive Distributed Lag estimation approach for the 5 of Next 11 net oil-exporting countries panel group portrays that, in the long-run, energy consumption negatively affects economic growth and energy prices positively influence economic growth, while in the short-run, economic growth is negatively affected by both energy consumption and energy prices.Keywords: Energy Consumption; Energy Prices; Economic Growth; Next 11 CountriesJEL Classifications: C33; C51; Q4; Q43DOI: https://doi.org/10.32479/ijeep.9880

Highlights

Energy has become a salient driver of any country’s economic growth
Results of panel pairwise Granger causality tests for the 6 N-11 net oil-importing countries are given in Table 11, which indicate that, at 10% significance level, a unidirectional causal association is found between energy prices and energy consumption
Results of panel pairwise Granger causality tests for the 5 N-11 net oil exporting countries are presented in Table 12, which show that, bidirectional causal linkage is stemming from energy consumption to economic growth for the 5 N-11 net oil-exporting countries which supports the feedback hypothesis and similar result is found by Phrakhruopatnontakitti and Jermsittiparsert (2020) for 4 Asian countries

Summary

Introduction

Energy has become a salient driver of any country’s economic growth. It contains a strategic impact for any country’s economic growth. Energy consumption and economic growth are considered to be highly correlated. Higher economic growth requires more energy consumption. Energy is an indispensable element in aggregated production function and in boosting economic growth level of any country. The energy consumption and economic growth relationship is largely studied in previous literatures (Apergis and Payne; 2009a; 2009b; 2010a; 2010b; Ozturk, 2010; Bouoiyour et al, 2014; Murshed, 2020a). Ucan et al (2014); Rafindadi and Ozturk (2015) and Rafindadi and Ozturk (2016) The energy consumption and economic growth relationship is largely studied in previous literatures (Apergis and Payne; 2009a; 2009b; 2010a; 2010b; Ozturk, 2010; Bouoiyour et al, 2014; Murshed, 2020a). Ucan et al (2014); Rafindadi and Ozturk (2015) and Rafindadi and Ozturk (2016)

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