Causal Relationship between Fossil Fuel Consumption and Economic Growth in Japan: A Multivariate Approach
AbstractThis paper explores whether Japanese economy can continue to grow without extensive dependence on fossil fuels. The paper conducts time series analysis using a multivariate model of fossil fuels, non-fossil energy, labor, stock and GDP to investigate the relationship between fossil fuel consumption and economic growth in Japan. The results of cointegration tests indicate long-run relationships among the variables. Using a vector error-correction model, the study reveals bidirectional causality between fossil fuels and GDP. The results also show that there is no causal relationship between non-fossil energy and GDP. The results of cointegration analysis, Granger causality tests, and variance decomposition analysis imply that non-fossil energy may not necessarily be able to play the role of fossil fuels. Japan cannot seem to realize both continuous economic growth and the departure from dependence on fossil fuels. Hence, growth-oriented macroeconomic policies should be re-examined.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoArticle provided by Econjournals in its journal International Journal of Energy Economics and Policy.
Volume (Year): 3 (2013)
Issue (Month): 2 ()
Contact details of provider:
Web page: http://www.econjournals.com
Fossil fuels; Economic growth; Cointegration; Granger causality;
Find related papers by JEL classification:
- Q32 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation - - - Exhaustible Resources and Economic Development
- Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Ozturk, Ilhan & Acaravci, Ali, 2010. "CO2 emissions, energy consumption and economic growth in Turkey," Renewable and Sustainable Energy Reviews, Elsevier, vol. 14(9), pages 3220-3225, December.
- Yuan, Jia-Hai & Kang, Jian-Gang & Zhao, Chang-Hong & Hu, Zhao-Guang, 2008. "Energy consumption and economic growth: Evidence from China at both aggregated and disaggregated levels," Energy Economics, Elsevier, vol. 30(6), pages 3077-3094, November.
- Lee, Chien-Chiang & Chien, Mei-Se, 2010. "Dynamic modelling of energy consumption, capital stock, and real income in G-7 countries," Energy Economics, Elsevier, vol. 32(3), pages 564-581, May.
- Zamani, Mehrzad, 2007. "Energy consumption and economic activities in Iran," Energy Economics, Elsevier, vol. 29(6), pages 1135-1140, November.
- Lee, Chien-Chiang & Chang, Chun-Ping, 2005. "Structural breaks, energy consumption, and economic growth revisited: Evidence from Taiwan," Energy Economics, Elsevier, vol. 27(6), pages 857-872, November.
- Johansen, Soren & Juselius, Katarina, 1990. "Maximum Likelihood Estimation and Inference on Cointegration--With Applications to the Demand for Money," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 52(2), pages 169-210, May.
- Asafu-Adjaye, John, 2000.
"The relationship between energy consumption, energy prices and economic growth: time series evidence from Asian developing countries,"
Elsevier, vol. 22(6), pages 615-625, December.
- Asafu-Adjaye, John, 1999. "The relationship between energy consumption, energy prices and economic growth: Time series evidence from Asian developing countries," 1999 Conference (43th), January 20-22, 1999, Christchurch, New Zealand 123754, Australian Agricultural and Resource Economics Society.
- Zachariadis, Theodoros, 2007. "Exploring the relationship between energy use and economic growth with bivariate models: New evidence from G-7 countries," Energy Economics, Elsevier, vol. 29(6), pages 1233-1253, November.
- Souhila EDDRIEF-CHERFI & Baghdad KOURBALI, 2012. "Energy Consumption and Economic Growth in Algeria: Cointegration and Causality Analysis," International Journal of Energy Economics and Policy, Econjournals, vol. 2(4), pages 238-249.
- Phung Thanh Binh, 2011. "Energy Consumption and Economic Growth in Vietnam: Threshold Cointegration and Causality Analysis," International Journal of Energy Economics and Policy, Econjournals, vol. 1(1), pages 1-17, June.
- Ozturk, Ilhan, 2010. "A literature survey on energy-growth nexus," Energy Policy, Elsevier, vol. 38(1), pages 340-349, January.
- Apergis, Nicholas & Payne, James E., 2010. "Energy consumption and growth in South America: Evidence from a panel error correction model," Energy Economics, Elsevier, vol. 32(6), pages 1421-1426, November.
- Nicholas Apergisu & Dan Danuletiu, 2012. "Energy Consumption and Growth in Romania: Evidence from a Panel Error Correction Model," International Journal of Energy Economics and Policy, Econjournals, vol. 2(4), pages 348-356.
- Kaplan, Muhittin & Ozturk, Ilhan & Kalyoncu, Huseyin, 2011. "Energy Consumption and Economic Growth in Turkey: Cointegration and Causality Analysis," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(2), pages 31-41, June.
- Engle, Robert F & Granger, Clive W J, 1987. "Co-integration and Error Correction: Representation, Estimation, and Testing," Econometrica, Econometric Society, vol. 55(2), pages 251-76, March.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Ilhan Ozturk).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.