An Investigation of an Adaptive Neuro-Fuzzy Inference System to Predict the Relationship among Energy Intensity, Globalization, and Financial Development in Major ASEAN Economies

Hafezali Hussain,Hassanudin Thaker,Fakarudin Kamarudin,Katarzyna Szczepańska-Woszczyna,Beata Slusarczyk

doi:10.3390/en13040850

Abstract

The enhancement of the financial sector significantly drives a nation’s economy and thereby increase energy intensity. Considering this situation, the current study aims to examine the link between globalization and financial advancements with the energy intensity of the top 5 ASEAN (Association of Southeast Asian Nations) economies. The development structure of the ASEAN region is considered significant for having stable growth. The authors used the annual data from 1990 to 2018 for five of the largest ASEAN economies: Singapore, Malaysia, Thailand, Indonesia, and the Philippines. The present study used novel methodology, the Adaptive Neuro-Fuzzy Inference System (ANFIS), to examine the nonlinear behaviour among globalization, financial development, and energy intensity in the top 5 ASEAN countries. The study results using ANFIS confirm that globalization and financial development are positively correlated and have a significant impact on the energy intensity level in the top ASEAN countries. The results further suggest that globalization and financial development increase the level of energy intensity more in the countries that are developed relative to their peers in the top ASEAN countries. Moreover, the outcomes of ANFIS also suggest that those countries, which are more globalized and financially developed, have more potential to increase the level of energy intensity. Therefore, the government needs to focus more on projects that involve renewable energy and are environmentally friendly.

Highlights

In the modern era, the enthusiasm for being advanced has not merely unified the nations economically but has resulted in escalating international competitiveness among industrialized and emerging economies
The findings indicated that the rise in globalization in both economies brought a positive change in energy utilization [4]
The findings revealed that the increases in globalization and financial development were the reasons for the enhanced energy utilization in the Next-11 economies

Summary

Introduction

The enthusiasm for being advanced has not merely unified the nations economically but has resulted in escalating international competitiveness among industrialized and emerging economies. The disparity in the specified link between globalization and energy, in the recent literature, has enhanced the need of examining the association of globalization with energy intensity, given its significant role in influencing economic advancement of both developed and developing economies. Being an economically diversified region, ASEAN practices hasty globalization and augmented financial advancements that expand energy demand in the region [19] In this regard, the empirical examination of the variables would prove significant to capture the specific link of financial advancements and globalization in driving energy intensity in the top five ASEAN countries separately, to add a more accurate and cohesive view of the GLO-FAD-ENIT nexus. Section five concludes the investigation by presenting a discussion of the findings, limitations, and policy implications

Literature Review

Methodology

Data Analysis and Interpretation

Results and Discussion