Asymmetric causality between renewable energy consumption and economic growth: fresh evidence from some emerging countries.

Abstract

Renewable energy is an important alternative energy source in terms of both sustainable growth and climate change. In this paper, the causality nexus between renewable energy consumption and economic growth is analyzed in 15 emerging countries covering the period from 1990 to 2015. The paper adopts the bootstrap panel causality test which is developed by (Kónya, Econ Model 23:978–992, 2006) to consider the cross-sectional dependence. The results of (Kónya, Econ Model 23:978–992, 2006) prove the validity of the neutrality hypothesis in all countries. Then, we analyze asymmetric causality among the variables. Asymmetric test denotes a causality from negative shocks of economic growth to negative shocks of renewable energy consumption in South Africa, Thailand, and Turkey. Thus, a negative shock in economic growth hampers renewable energy consumption in these countries. Our results demonstrate the consequences of the application of disaggregated data in the analyses.