The long-run and causal analysis of energy,growth, openness and financial development on carbon emissions in Turkey

The aim of this paper is to examine the causal relationship between financial development, trade, economic growth, energy consumption and carbon emissions in Turkey for the 1960–2007 period. The bounds F‐test for cointegration test yields evidence of a long-run relationship between per capita carbon emissions, per capita energy consumption, per capita real income, the square of per capita real income, openness and financial development. The results show that an increase in foreign trade to GDP ratio results an increase in per capita carbon emissions and financial development variable has no significant effect on per capita carbon emissions in the long- run. These results also support the validity of EKC hypothesis in the Turkish economy. It means that the level of CO₂ emissions initially increases with income, until it reaches its stabilization point, then it declines in Turkey. In addition, the paper explores causal relationship between the variables by using error-correction based Granger causality models.     

CO2 emissions,energy consumption and economic growth in Turkey

This paper examines the long run and causal relationship issues between economic growth, carbon emissions, energy consumption and employment ratio in Turkey by using autoregressive distributed lag bounds testing approach of cointegration. Empirical results for Turkey over the period 1968–2005 suggest an evidence of a long-run relationship between the variables at 5% significance level in Turkey. The estimated income elasticity of carbon emissions per capita is ?0.606 and the income elasticity of energy consumption per capita is 1.375. Results for the existence and direction of Granger causality show that neither carbon emissions per capita nor energy consumption per capita cause real GDP per capita, but employment ratio causes real GDP per capita in the short run. In addition, EKC hypothesis at causal framework by using a linear logarithmic model is not valid in Turkish case. The overall results indicates that energy conservation policies, such as rationing energy consumption and controlling carbon dioxide emissions, are likely to have no adverse effect on the real output growth of Turkey.     

Energy consumption and GDP in Tunisia: Cointegration and causality analysis

In this paper, the Johansen cointegration technique is used to examine the causal relationship between per capita energy consumption (PCEC) and per capita gross domestic product (PCGDP) for Tunisia during the 1971–2004 period. In order to test for Granger causality in the presence of cointegration among the variables, a vector error correction model (VECM) is used instead of a vector autoregressive (VAR) model. Our estimation results indicate that the PCGDP and PCEC for Tunisia are related by one cointegrating vector and that there is a long-run bi-directional causal relationship between the two series and a short-run unidirectional causality from energy to gross domestic product (GDP). The source of causation in the long-run is found to be the error-correction terms in both directions. Hence, an important policy implication resulting from this analysis is that energy can be considered as a limiting factor to GDP growth in Tunisia. Conclusions for Tunisia may also be relevant for a number of countries that have to go through a similar development path of increasing pressure on already scarce energy resources.     

Electricity consumption and economic growth: a time series experience for 17 African countries

While the availability of electricity by itself is not a panacea for the economic and social problems facing Africa, the supply of electricity is nevertheless believed to be a necessary requirement for Africa's economic and social development. This paper tests the long-run and causal relationship between electricity consumption per capita and real gross domestic product (GDP) per capita for 17 African countries for the period 1971–2001 using a newly developed cointegration test proposed by Pesaran et al. (2001) and using a modified version of the Granger causality test due to Toda and Yamamoto (1995). The advantage of using these two approaches is that they both avoid the pre-testing bias associated with conventional unit root and cointegration tests. The empirical evidence shows that there was a long-run relationship between electricity consumption per capita and real GDP per capita for only 9 countries and Granger causality for only 12 countries. For 6 countries there was a positive uni-directional causality running from real GDP per capita to electricity consumption per capita; an opposite causality for 3 countries and bi-directional causality for the remaining 3 countries. The result should, however, be interpreted with care as electricity consumption accounts for less than 4% of total energy consumption in Africa and only grid-supplied electricity is taken into account.     

Electricity consumption and economic growth nexus in Bangladesh: Revisited evidences

In this paper, an attempt is being made to examine the causal relationship between per capita electricity consumption and per capita GDP of Bangladesh using the vector error correction specified Granger causality test to search their short-run, long-run and joint causal relationships for the period of 1971–2008. Empirical findings reveal that there is a short-run unidirectional causal flow running from per capita electricity consumption to per capita GDP without feedback. The presence of a positive short-run causality explains that an increase in electricity consumption directly affects economic activity in Bangladesh. Likewise, results from joint causality exhibit the same as in short-run. By contrast, long-run results show a bi-directional causality running from electricity consumption to economic growth with feedback. These findings can provide essential policy insights to design immediate and long-term growth prospect for Bangladesh keeping in mind its present planned growth strategy and dismal power and energy sector.     

Energy consumption and economic growth: Evidence from the economic community of West African States (ECOWAS)

Access to modern energy is believed to be a prerequisite for sustainable development, poverty alleviation and the achievement of the Millennium Development Goals.However, theoretical models and empirical results offer conflicting evidence on the relationship between energy consumption and economic growth that we remain largely unsure of the cause-and-effect nature of this relationship, if indeed a relationship exists at all.This paper tests, in a panel context, the long-run relationship between energy access, and economic growth for fifteen African countries from 1980 to 2008 by using recently developed panel cointegration techniques.We adopt a three-stage approach, consisting of panel unit root, panel cointegration and Granger causality tests to study the dynamic causal relationships between energy consumption, energy prices and growth as well as relationship between electricity consumption, prices and growth.Results show that GDP and energy consumption as well as GDP and electricity move together in the long-run. By estimating these long-run relationships and testing for causality using panel-based error correction models, we found unidirectional long-run and short-run causality. The causality is running from GDP to energy consumption in the short-run, and from energy consumption to GDP in the long-run. There is also evidence of unidirectional causality running from electricity consumption to GDP in the long-run.This study thus provides empirical evidence of long-run and causal relationships between energy consumption and economic growth for our sample of fifteen countries; suggesting that lack or limited access to modern energy services could hamper economic growth and compromise the development prospects of these countries.     

The short and long run causality relationship among economic growth,energy consumption and financial development: Evidence from South Mediterranean Countries (SMCs)

This study aims at examining the short-run and long-run causal link between economic growth, energy consumption and financial development by using data set of 6 SMCs for the 1995–2015 periods. The basic testing procedure requires four steps: ADF and PP unit root tests, Bound tests for Co-integration, ARDL approach and VECM method. The results confirm cointegration between the variables. It means that the long-run relationship exists. The short-run causal relationships (unidirectional) exist at least once for each country (except Egypt). The Granger causality results for individual countries give mixed results. These results urge for the attention of the policy makers in SMCs to design a comprehensive energy conservation policy to minimize the consequences of massive energy consumption on economic growth by adding financial development.     

The relationship between pollutant emissions,renewable energy,nuclear energy and GDP: empirical evidence from 18 developed and developing countries

This document investigates the causal relationship between nuclear energy (NE), pollutant emissions (CO₂ emissions), gross domestic product (GDP) and renewable energy (RE) using dynamic panel data models for a global panel consisting of 18 countries (developed and developing) covering the 1990–2013 period. Our results indicate that there is a co-integration between variables. The unit root test suggests that all the variables are stationary in first differences. The paper further examines the link using the Granger causality analysis of vector error correction model, which indicates a unidirectional relationship running from GDP per capita to pollutant emissions for the developed and developing countries. However, there is a unidirectional causality from GDP per capita to RE in the short and long run. This finding confirms the conservation hypothesis. Similarly, there is no causality between NE and GDP per capita.     

Electricity demand,GDP and employment: evidence from Italy

This paper applies time series methodologies to examine the causal relationship among electricity demand, real per capita GDP and total labor force for Italy from 1970 to 2009. After a brief introduction, a survey of the economic literature on this issue is reported, before discussing the data and introducing the econometric techniques used. The results of estimation indicate that one cointegrating relationship exists among these variables. This equilibrium relation implies that, in the long-run, GDP and labor force are correlated negatively, as well as GDP and electricity. Moreover, there is a bi-directional Granger causality flow between real per capita GDP and electricity demand; while labor force does not Grangercause neither real per capita GDP nor electricity demand. This implies that electricity demand and economic growth are jointly determined at the same time for the Italian case. The forecast error variance decomposition shows that forecast errors in real per capita GDP are mainly caused by the uncertainty in GDP itself, while forecast errors in labor force are mainly resulted from the labor force itself, although aggregate income and electricity are important, too.     

Electricity consumption and real GDP causality nexus: Evidence from ARDL bounds testing approach for 11 MENA countries

This paper investigates the short-run and long-run causality issues between electricity consumption and economic growth in the selected 11 Middle East and North Africa (MENA) countries by using Autoregressive Distributed Lag (ARDL) bounds testing approach of cointegration and vector error-correction models. It employs annual data covering the period from 1971 to 2006. The unit root tests results indicate that some of the variables for Algeria, Jordan, Tunisia and United Arab Emirates do not satisfy the underlying assumptions of the ARDL bounds testing approach of cointegration methodology before proceeding to the estimation stage. Thus, we drop these countries from the ARDL bounds testing approach of cointegration and causality analysis. The cointegration test results show that there is no cointegration between the electricity consumption and the economic growth in three of the seven countries (Iran, Morocco and Syria). Thus, causal relationship cannot be estimated for these countries. However, the cointegration and causal relationship is found in four countries (Egypt, Israel, Oman and Saudi Arabia). The overall results indicate that there is no relationship between the electricity consumption and the economic growth in most of the MENA countries. Further evidence indicates that policies for energy conservation can have a little or no impact on economic growth in most of the MENA countries.     

Short-run and long-run elasticities of import demand for crude oil in Turkey

The aim of this study is to attempt to estimate the short-run and the long-run elasticities of demand for crude oil in Turkey by the recent autoregressive distributed lag (ARDL) bounds testing approach to cointegration. As a developing country, Turkey meets its growing demand for oil principally by foreign suppliers. Thus, the study focuses on modelling the demand for imported crude oil using annual data covering the period 1980–2005. The bounds test results reveal that a long-run cointegration relationship exists between the crude oil import and the explanatory variables: nominal price and income, but not in the model that includes real price in domestic currency. The long-run parameters are estimated through a long-run static solution of the estimated ARDL model, and then the short-run dynamics are estimated by the error correction model. The estimated models pass the diagnostic tests successfully. The findings reveal that the income and price elasticities of import demand for crude oil are inelastic both in the short run and in the long run.     

Electricity supply,employment and real GDP in India: evidence from cointegration and Granger-causality tests

This study probes nexus between electricity supply, employment and real GDP for India within a multivariate framework using autoregressive distributed lag (ARDL) bounds testing approach of cointegration. Long-run equilibrium relationship has been established among these variables for the time span 1970–71 to 2005–06. The study further establishes long- and short-run Granger causality running from real GDP and electricity supply to employment without any feedback effect. Thus, growth in real GDP and electricity supply are responsible for the high level of employment in India. The absence of causality running from electricity supply to real GDP implies that electricity demand and supply side measures can be adopted to reduce the wastage of electricity, which would not affect future economic growth of India.     

Renewable energy consumption and economic growth: Evidence from a panel of OECD countries

This study examines the relationship between renewable energy consumption and economic growth for a panel of twenty OECD countries over the period 1985–2005 within a multivariate framework. Given the relatively short span of the time series data, a panel cointegration and error correction model is employed to infer the causal relationship. The heterogeneous panel cointegration test reveals a long-run equilibrium relationship between real GDP, renewable energy consumption, real gross fixed capital formation, and the labor force with the respective coefficients positive and statistically significant. The Granger-causality results indicate bidirectional causality between renewable energy consumption and economic growth in both the short- and long-run.     

Energy consumption and economic growth nexus in Tanzania: An ARDL bounds testing approach

In this paper, we examine the intertemporal causal relationship between energy consumption and economic growth in Tanzania during the period of 1971–2006. Unlike the majority of the previous studies, we employ the newly developed autoregressive distributed lag (ARDL)-bounds testing approach by Pesaran et al. [2001. Bounds testing approaches to the analysis of level relationships. Journal of Applied Econometrics 16, 289–326] to examine this linkage. We also use two proxies of energy consumption, namely total energy consumption per capita and electricity consumption per capita. The results of the bounds test show that there is a stable long-run relationship between each of the proxies of energy consumption and economic growth. The results of the causality test, on the other hand, show that there is a unidirectional causal flow from total energy consumption to economic growth and a prima-facie causal flow from electricity consumption to economic growth. Overall, the study finds that energy consumption spurs economic growth in Tanzania.     

Energy consumption and economic growth: New insights into the cointegration relationship

This paper examines the long-run relationship between energy consumption and real GDP, including energy prices, for 25 OECD countries from 1981 to 2007. The distinction between common factors and idiosyncratic components using principal component analysis allows to distinguish between developments on an international and a national level as drivers of the long-run relationship. Indeed, cointegration between the common components of the underlying variables indicates that international developments dominate the long-run relationship between energy consumption and real GDP. Furthermore, the results suggest that energy consumption is price-inelastic. Causality tests indicate the presence of a bi-directional causal relationship between energy consumption and economic growth.     

Causality relationship between electricity consumption and GDP in Bangladesh

In this paper, we examine the causal relationship between the per capita electricity consumption and the per capita GDP for Bangladesh using cointegration and vector error correction model. Our results show that there is unidirectional causality from per capita GDP to per capita electricity consumption. However, the per capita electricity consumption does not cause per capita GDP in case of Bangladesh. The finding has significant implications from the point of view of energy conservation, emission reduction and economic development.     

Energy consumption and economic growth in China: A multivariate causality test

This study takes a fresh look at the direction of causality between energy consumption and economic growth in China during the period from 1972 to 2006, using a multivariate cointegration approach. Given the weakness associated with the bivariate causality framework, the current study performs a multivariate causality framework by incorporating capital and labor variables into the model between energy consumption and economic growth based on neo-classical aggregate production theory. Using the recently developed autoregressive distributed lag (ARDL) bounds testing approach, a long-run equilibrium cointegration relationship has been found to exist between economic growth and the explanatory variables: energy consumption, capital and employment. Empirical results reveal that the long-run parameter of energy consumption on economic growth in China is approximately 0.15, through a long-run static solution of the estimated ARDL model, and that for the short-run is approximately 0.12 by the error correction model. The study also indicates the existence of short-run and long-run causality running from energy consumption, capital and employment to economic growth. The estimation results imply that energy serves as an important source of economic growth, thus more vigorous energy use and economic development strategies should be adopted for China.     

Economic growth,energy consumption and CO2 emissions in India: a disaggregated causal analysis

This study examines the long-run and short-run causal relationships among energy consumption, real gross domestic product (GDP) and CO₂ emissions using aggregate and disaggregate (sectoral) energy consumption measures utilising annual data from 1971 to 2011. The autoregressive distributed lag bounds test reveals that there is a long-run relationship among the variables concerned at both aggregate and disaggregate levels. The Toda–Yamamoto causality tests, however, reveal that the long-run as well short-run causal relationship among the variables is not uniform across sectors. The weight of evidences of the study indicates that there is short-run causality from electricity consumption to economic growth, and to CO₂ emissions. The results suggest that India should take appropriate cautious steps to sustain high growth rate and at the same time to control emissions of CO₂. Further, energy and environmental policies should acknowledge the sectoral differences in the relationship between energy consumption and real gross domestic product.     

An econometric study of CO2 emissions,energy consumption,income and foreign trade in Turkey

This study attempts to empirically examine the dynamic causal relationships between carbon emissions, energy consumption, income, and foreign trade in the case of Turkey using the time-series data for the period 1960–2005. This research tests the interrelationship between the variables using the bounds testing to cointegration procedure. The bounds test results indicate that there exist two forms of long-run relationships between the variables. In the case of first form of long-run relationship, carbon emissions are determined by energy consumption, income and foreign trade. In the case of second long-run relationship, income is determined by carbon emissions, energy consumption and foreign trade. An augmented form of Granger causality analysis is conducted amongst the variables. The long-run relationship of CO₂ emissions, energy consumption, income and foreign trade equation is also checked for the parameter stability. The empirical results suggest that income is the most significant variable in explaining the carbon emissions in Turkey which is followed by energy consumption and foreign trade. Moreover, there exists a stable carbon emissions function. The results also provide important policy recommendations.     

The role of natural gas consumption and trade in Tunisia's output

This paper examines the impact of natural gas consumption, real gross fixed capital formation and trade on the real GDP in the case of Tunisia over the period 1980–2010. We use an Autoregressive Distributed Lag (ARDL) bounds testing approach to test for cointegration between the variables. The Toda–Yamamoto approach is then used to test for causality. Our findings indicate the existence of a long-term relationship between the variables. Natural gas consumption, real gross fixed capital formation and trade add in economic growth. Natural gas consumption, real gross fixed capital formation and real trade cause real GDP in Tunisia. These findings open up new insights for policymakers to formulate a comprehensive energy policy to sustain economic growth in the long-term.