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Causal Interactions Between Fdi, Electricity Consumption And Economic Growth: Evidence From Dynamic Panel Co-Integration Models

Author

Listed:
  • Mostefa BELMOKADDEM

    (Fac. of Economics, Business and Management Sciences, POLDEVA Lab, University of Tlemcen, Algeria)

  • Yassine Zakaria GHOUALI

    (Fac. of Economics, Business and Management Sciences, POLDEVA Lab, University of Tlemcen, Algeria)

  • Mohammed Seghir GUELLIL

    (Fac. of Economics, Business and Management Sciences, POLDEVA Lab, University of Tlemcen, Algeria)

  • Mohammed Abbes SAHRAOUI

    (Fac. of Economics, Business and Management Sciences, POLDEVA Lab, University of Tlemcen, Algeria)

Abstract

In all countries, especially developing countries, foreign direct investment (FDI) plays a very important role, it is even considered as the engine of economic growth and development. Energy has always played a major role in human and economic development as well as in the well-being of society and modern societies are increasingly using more energy for industry, services, housing and transportation. This is particularly true for oil, which is now the most important traded commodity, but also for electricity, which is essential in contemporary economies characterized by the omnipresence of information technology, communication and digital. This study analyzes the relationship between foreign direct investment, electricity consumption and economic growth in 65 countries, using co-integration and Granger causality tests in panel data. The results show a disparity in terms of the relationship between the co-integration of the panel study. The results also indicate a unidirectional causality from FDI to GDP could be a good tool to prioritize the allocation of resources across sectors to promote foreign direct investment, and a bi-directional causality between the electric consumption and GDP for some panel

Suggested Citation

  • Mostefa BELMOKADDEM & Yassine Zakaria GHOUALI & Mohammed Seghir GUELLIL & Mohammed Abbes SAHRAOUI, 2014. "Causal Interactions Between Fdi, Electricity Consumption And Economic Growth: Evidence From Dynamic Panel Co-Integration Models," Journal of Social and Economic Statistics, Bucharest University of Economic Studies, vol. 3(2), pages 1-30, DECEMBER.
    • Handle: RePEc:aes:jsesro:v:3:y:2014:i:2:p:1-30
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    References listed on IDEAS

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    Cited by:

    1. Bah, Muhammad Maladoh & Azam, Muhammad, 2017. "Investigating the relationship between electricity consumption and economic growth: Evidence from South Africa," Renewable and Sustainable Energy Reviews, Elsevier, vol. 80(C), pages 531-537.
    2. Pacific K. T. Yapatake & Shan J. Li & Ramadhan A. Abeid, 2017. "Military Expenditure, Export, FDI and Economic Performance in Cameroon," CEREDEC Working Papers 17/002, Centre de Recherche pour le Développement Economique (CEREDEC).

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    More about this item

    Keywords

    Panel co-integration; Foreign Direct Investment; Electricity consumption; Economic growth; Fmols and Dols Estimators; Panel Granger causality;
    All these keywords.

    JEL classification:

    • C00 - Mathematical and Quantitative Methods - - General - - - General
    • C01 - Mathematical and Quantitative Methods - - General - - - Econometrics
    • C2 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models

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