GDP growth - Energy Consumption Relationship: Revisited. Issue 3 (19th August 2014)

• Record Type: Journal Article
• Authors: Al-mulali, Usama; Dey, PrasantaKumar; Dey, PrasantaKumar
• Is Part Of: International journal of energy sector management. Volume 8:Issue 3(2014)
• Publication Date: 2014-08-19
• Subjects: Energy industries -- Management -- Periodicals; 333.79068
• DOI: 10.1108/IJESM-04-2013-0004
• Languages: English
• ISSNs: 1750-6220

Abstract

<abstract> <title> <x content-type="archive" xml:space="preserve">Abstract</x> </title> <sec sec-type="purpose"> <title>Purpose</title> <p>This study investigated the relationship between GDP growth and renewable and non-renewable energy consumption in 82 developing countries categorized by region. </p> </sec> <sec sec-type="design|methodology|approach"> <title>Design/methodology/approach</title> <p>To achieve the goal of this study, the panel model was used taking the period 1990-2009. </p> </sec> <sec sec-type="findings"> <title>Findings</title> <p>The Kao cointegration test results showed that both renewable and non-renewable energy consumption had a long run relationship with all the economic sectors in all regions. Moreover, the FMOLS revealed that the renewable and non-renewable energy consumption had a long run positive relationship with the economic sectors. However, the results also revealed that non-renewable energy consumption has a more significant effect on the economic sectors than the renewable energy consumption. In addition, the Granger causality showed the same results, that the causal relationship between the economic sectors and non-renewable energy consumption is more significant than the causal relationship between the economic sectors and renewable energy. </p> </sec> <sec sec-type="practical implications"> <title>Practical implications</title> <p>The reason behind these results is that these regions still depend on fossil fuels to promote their economic growth. Fossil fuels basically contribute more than 80% of their total energy consumption. Thus the study recommends the developing countries to increase their investment on renewable energy projects to increase the share of the renewable energy of total energy consumption.</p> </sec> <sec sec-type="originality|value"> <title>Originality/value</title> <p>This study is considered different from all the previous studies because it will investigate the disaggregate relationship between GDP and energy consumption (renewable and non-renewable) in East Asia and Pacific, Europe and Central Asia, Latin America and the Caribbean, Middle East and North Africa, South Asia, and the Sub-Saharan African developing countries.</p> </sec> </abstract>