The Causal Relationship between Energy Consumption, CO2 Emission, Population Growth and Economic Growth in South Africa: A Multivariate Investigation

Abstract

The paper empirically examines the short and long-run causal relationship between energy consumption, CO2 emission, population growth and economic growth in South Africa. In so doing, the paper employs multivariate Granger-Causality within an ARDL-bounds testing approach to co-integration and unrestricted error correction model (UECM). The paper finds that energy usage and electricity consumption cause economic growth in South Africa but only in the short run. Additionally, the paper finds that, economic growth, population growth and energy consumption cause CO2 emission. Thus, policies should be targeted at the expansion of renewable and efficient electricity production in order to cope with the expected demand from expected population growth and from increasing demand from industries in order to maintain sustainable economic growth