The Impact of Renewable and Non-Renewable Energies Consumption on Economic growth in D-8 group countries

Document Type : Research Paper

Authors

1 Ph.D. Student of Natural Resources and Environmental Economics, College of Agriculture, Shiraz University

2 PhD in Agricultural Economics, Faculty of Agriculture, Shiraz University

3 Assistant Professor of Agricultural Economics, College of Agriculture, Shiraz University

Abstract

According to the importance of clean energies in the reduction of greenhouse gas emission and environmental damage, in the present study, the impact of renewable energy consumption on economic growth in the D-8 group countries was investigated over the period of 1990 to 2014. According to the panel stationary property of the variables, the panel autoregressive distributed lag method (Panel ARDL) of mean group (MG), pooled mean group (PMG), and dynamic fixed effect (DFE) estimators were investigated. The empirical results implied that the pooled mean group model emerged as the most efficient among the three estimators. The results of causality tests indicate that there is a bidirectional causality relationship among clean energy (renewable), non-renewable energy, and economic growth in D-8 group countries. The results show that controlling for the other variables, a 1% rise in clean energy causes is likely to cause a 0.15% increase in economic growth in the long-run. Also, the results showed that in the long-run, a 1% increase in non-renewable energy will decrease the economic growth of D-8 group countries by 0.12%. Also, empirical results indicate that investment, employment and technology have a significant and positive effect on economic growth in long run. According to the results of present study, clean energy production and consumption must be increased in the D-8 countries
 

Keywords

References

آذربایجانی، کریم، علی سرخوش‌سرا و ساناز یونس‌پور (1397)، تحلیل تأثیر سرمایه‌گذاری مستقیم خارجی و آزادسازی تجاری در کیفیت محیط ‌زیست و استفاده از انرژی‌های پاک: مطالعۀ کشورهای منتخب درحال‌توسعه. اقتصاد و تجارت نوین، 4: 27-1.
فطرس، محمدحسن، اکبر آقازاده و سودا جبرائیلی (1391)، بررسی میزان تأثیر مصرف انرژی‌های تجدیدپذیر و تجدیدناپذیر بر رشد اقتصادی کشورهای منتخب درحال‌توسعه (شامل ایران)، دوره‌ی زمانی 2009 - 1980. فصلنامه مطالعات اقتصاد انرژی، 32: 72-51.
محمدباقری، اعظم (1389)، بررسی روابط کوتاه‌مدت و بلندمدت بین تولید ناخالص داخلی، مصرف انرژی و انتشار دی‌اکسید کربن در ایران. مطالعات اقتصاد انرژی، 7 (27): 129-101.
مرادقلی، فاطمه، غلامرضا زمانیان و مجید هاتفی‌مجومرد (1399)، تاثیر مصرف انرژی، توسعه مالی بر رشد اقتصادی ایران؛ مبتنی بر رهیافت غیرخطی و نامتقارن. فصلنامه سیاست‌های مالی و اقتصادی، 29: 53-7.
ورهرامی، ویدا، سمانه جواهردهی و سحر دشتبان‌فاروجی (1394)، بررسی رابطه بین رشد اقتصادی، توسعه بخش بانکی و متغیرهای کلان اقتصادی با استفاده از روش پانل ور؛ مطالعه موردی کشورهای گروه  .D-8مجله علمی پژوهشی اقتصاد مقداری، 4: 65-39.
Abrigo, R.M. and Love, I., (2016): Estimation of Panel Vector Autoregression in Stata: a Package of Programs. Working Papers 201602, University of Hawaii at Manoa, Department of Economics.
Adams, S., Klobodu, E.K. and Apio, A., (2018): Renewable and non-renewable energy, regime type and economic growth. Renew. Energy. 125, 755–767.
Ahmed, A., Uddin, G. S. and Sohag, K., (2016): Biomass energy, technological progress and the environmental Kuznets curve: Evidence from selected European countries. Biomass and Bioenergy. 90, 202-208.
Apergis, N. and Payne, J.E., (2009): Energy consumption and economic growth in Central America: evidence from a panel cointegration and error correction model. Energy Economics. 31, 211–216.
Apergis, N. and Payne, J.E., (2010a): Energy consumption and growth in South America: evidence from a panel error correction model. Energy Economics. 32 (6), 1421–1426.
Apergis, N. and Payne, J.E., (2010b): Renewable energy consumption and economic growth: evidence from a panel of OECD countries. Energy Policy. 38 (1) 656-660.
Apergis, N. and Payne, J.E., (2012): Renewable and non-renewable energy consumption-growth nexus: Evidence from a panel error correction model. Energy Economics. 34(3), 733-738.
Aslan, A., Apergis, N. and Yildirim, S., (2014): Causality between energy consumption and GDP in the U.S.: Evidence from wavelet analysis. Frontiers in Energy. 8(1), 1–8.
Aydin, M., (2019): Renewable and non-renewable electricity consumption-economic growth nexus: Evidence from OECD countries. Renew. Energy. 136, 599–606.
Baltagi, B. H. and Kao, C., (2001): Nonstationary panels, cointegration in panels and dynamic panels: A survey. In Nonstationary panels, panel cointegration and dynamic panels (pp. 7-51). Emerald Group Publishing Limited.
Baltagi, B., (2008): Econometric analysis of panel data. John Wiley and Sons.
Bhattacharya, M., Paramati, S.R., Ozturk, I. and Bhattacharya, S., (2016): The e_ect of renewable energy consumption on economic growth: Evidence from top 38 countries. Appl. Energy. 162, 733–741.
Campos, N. F. and Kinoshita, Y., (2008): Foreign Direct Investment and Structural Reforms: Evidence from Eastern Europe and Latin America (No. 6690). CEPR Discussion Papers.
Chaitip, P., Chokethaworn, K., Chaiboonsri, C. and Khounkhalax, M., (2015): Money Supply Influencing on Economic Growth-wide Phenomena of AEC Open Region. Procedia Economics and Finance. 24, 108-115.
Chontanawat, J., Hunt, L.C. and Pierse, R., (2008): Does energy consumption cause economic growth? Evidence from a systematic study of over 100 countries. J. Pol Model. 30 (2), 209–220.
D-8 (Organisation for Economic Cooperation), (2017): Retrieved October 22, 2017, from http: www.developing8.org.
Danish, Zhang, B., Wang, B. and Wang, Z., (2017): Role of renewable energy and non-renewable energy consumption on EKC: Evidence from Pakistan. Journal of Cleaner Production. 156, 855–864.
Destek, M. A. and Aslan, A., (2017): Renewable and non-renewable energy consumption and economic growth in emerging economies: Evidence from bootstrap panel causality. Renewable Energy. 111(Supplement C), 757–763.
Dogan, E., (2016): Analyzing the linkage between renewable and non-renewable energy consumption and economic growth by considering structural break in time-series data. Renewable Energy. 99, 1126-1136.
Ellabban, O., Abu-Rub, H. and Blaabjerg, F., (2014): Renewable energy resources: Current status, future prospects and their enabling technology. Renewable and Sustainable Energy Reviews. 39, 748–764.
Esfahani, H. S., & Ramı́rez, M. T. (2003). Institutions, infrastructure, and economic growth. Journal of development Economics, 70(2), 443-477.
European Parliament, (2016): Promotion of renewable energy sources in the EU, EU policies and Member State approaches, European Union. 24 p. Retrieved from http:..www.europarl.europa.eu.RegData.etudes.IDAN.2016.583810.EPRS_IDA(2016)583810_EN.pdf.
Gozgor, G., Lau, C.K.M. and Lu, Z., (2018): Energy consumption and economic growth: New evidence from the OECD countries. Energy. 153, 27–34.
growth. Journal of development Economics. 70(2), 443-477.
Gujarati. A.N. (1999): Basic Econometrics. Translated by Abrishami H, Tehran, Tehran university press, 1999.
Hausman, J. A., (1978): Specification tests in econometrics. Econometrics: Journal of the Econometric Society, 1251-1271.
IEA, (2018): What is energy security? https: www.iea.org. topics. energysecurity. [What is energy security. accessed 18.01.18].
Im, K. S., Pesaran, M. H. and Shin, Y., (2003): Testing for unit roots in heterogeneous panels. Journal of econometrics. 115(1): 53-74.
Inglesi-Lotz, R., (2016): The impact of renewable energy consumption to economic growth: A panel data application. Energy Econ. 53, 58–63.
Ito, K., (2016). CO2 emissions, renewable and non-renewable energy consumption, and economic growth: Evidence from panel data for developed countries. Econ. Bull. 36, 553.
Koçak, E. and Şarkgüneşi, A., (2017): The renewable energy and economic growth nexus in Black Sea and Balkan countries. Energy Policy. 100(Supplement C), 51–57.
Kraft, J. and Kraft, A., (1978). On the relationship between energy and GNP. J. Energy Dev. 3, 401-403.
Levin, A., Lin, C. F. and Chu, C. J., (2002): Unit root tests in panel data: Asymptotic and finite-sample properties. Journal of Econometrics. 108, 1, 1–24.
Love, I. and Zicchino, L., (2006): Financial development and dynamic investment behavior: Evidence from panel VAR. The Quarterly Review of Economics and Finance. 46(2), 190-210.
Matei, I., (2017): Is there a Link between Renewable Energy Consumption and Economic Growth? A Dynamic Panel Investigation for the OECD Countries. REP, 127 (6), 986-1012.
Narayan, S. and Doytch, N., (2017): An investigation of renewable and non-renewable energy consumption and economic growth nexus using industrial and residential energy consumption. Energy Econ. 68, 160–176.
Pesaran, M. H. and Shin, Y., (1998): An autoregressive distributed-lag modelling approach to cointegration analysis. Econometric Society Monographs. 31, 371-413.
Pesaran, M. H. and Smith, R., (1995): Estimating long-run relationships from dynamic heterogeneous panels. Journal of econometrics, 68(1). 79-113.
Pesaran, M. H., Shin, Y. and Smith, R. P., (1999): Pooled mean group estimation of dynamic heterogeneous panels. Journal of the American Statistical Association. 94(446), 621-634.
Pfeiffer, B. and Mulder, P., (2013): Explaining the diffusion of renewable energy technology in developing countries. Energy Economics, 40, 285-296.
Rahman, M.M. and Velayutham, E., (2020): Renewable and non-renewable energy consumption-economic growth nexus: New evidence from South Asia. Renewable Energy. 147, 399-408.
Rahman, M.M., (2017): Do population density, economic growth, energy use and exports adversely affect environmental quality in populous Asian countries? Ren and Sust Ener Rev.77 506-514.
Sadorsky, P., (2009): Renewable energy consumption, CO2 emissions and oil prices in the G7 countries. Energy Economics. 31(3), 456–462.
Saygin, D., Kempener, R., Wagner, N., Ayuso, M. and Gielen, D., (2015): The implications for renewable energy innovation of doubling the share of renewables in the global energy mix between 2010 and 2030. Energies. 8(6), 5828-5865.
Shahbaz, M., Loganathan, N., Muzaffar, A. T., Ahmed, K. and Jabran, M. A., (2016): How urbanization affects CO2 emissions in Malaysia? The application of STIRPAT model. Renewable and Sustainable Energy Reviews. 57: 83-93.
Singh, N., Nyuur, R. and Richmond, B., (2019): Renewable Energy Development as a Driver of Economic Growth: Evidence from Multivariate Panel Data Analysis. Sustainability.11, 2418.
Stern, D. I. and Cleveland, C. J., (2004); Energy and economic growth. Encyclopedia of energy. 2, 35-51.
Tang, C.F., Tan, B.W. and Ozturk, I., (2016): Energy consumption and economic growth in Vietnam. 566 Ren and Sust Ener Rev. 54, 1506-14.
Tugcu, C.T., Ozturk, I. and Aslan, A., (2012): Renewable and non-renewable energy consumption and economic growth relationship revisited: Evidence from G7 countries. Energy Econ. 34, 1942–1950.
Tuna, G. and Tuna, V.E., (2019): The asymmetric causal relationship between renewable and NON-RENEWABLE energy consumption and economic growth in the ASEAN-5 countries. Resour. Policy. 62, 114–124.
Ucan, O., Aricioglu, E. and Yucel, F., (2014): Energy Consumption and Economic Growth Nexus: Evidence from Developed Countries in Europe. International Journal of Energy Economics and Policy. 3, 411-419.
World Development Indicators (WDI), (2019): Retrieved July 15, 2019, from http: www.worldbank.org.
Yildirim, E., (2014): Energy use, CO2 emission and foreign direct investment: Is there any inconsistence between causal relations? Frontiers in Energy. 8(3), 269–278.
new economy and trad
Volume 15, Issue 2
October 2020
Pages 67-90

Files

History

  • Receive Date: 03 February 2020
  • Revise Date: 26 March 2020
  • Accept Date: 22 April 2020

Share

How to cite

Statistics