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Electricity consumption and economic growth nexus in Bangladesh: Revisited evidences

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  • Golam Ahamad, Mazbahul
  • Nazrul Islam, A.K.M.

Abstract

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.

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Bibliographic Info

Article provided by Elsevier in its journal Energy Policy.

Volume (Year): 39 (2011)
Issue (Month): 10 (October)
Pages: 6145-6150

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Handle: RePEc:eee:enepol:v:39:y:2011:i:10:p:6145-6150

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Web page: http://www.elsevier.com/locate/enpol

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Keywords: Electricity consumption Economic growth Causality;

References

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Citations

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Cited by:
  1. Ahamad, Mazbahul & Tanin, Fahian, 2013. "Next power generation-mix for Bangladesh: Outlook and policy priorities," Energy Policy, Elsevier, vol. 60(C), pages 272-283.
  2. Bruns, Stephan B. & Gross, Christian & Stern, David I., 2013. "Is There Really Granger Causality Between Energy Use and Output?," FCN Working Papers 11/2013, E.ON Energy Research Center, Future Energy Consumer Needs and Behavior (FCN).
  3. Al-mulali, Usama & Fereidouni, Hassan Gholipour & Lee, Janice Ym & Sab, Che Normee Binti Che, 2013. "Examining the bi-directional long run relationship between renewable energy consumption and GDP growth," Renewable and Sustainable Energy Reviews, Elsevier, vol. 22(C), pages 209-222.
  4. Chibueze, E. Nnaji & Jude, O. Chukwu & Nnaji Moses, 2013. "Electricity Supply, Fossil fuel Consumption, Co2 Emissions and Economic Growth: Implications and Policy Options for Sustainable Development in Nigeria," International Journal of Energy Economics and Policy, Econjournals, vol. 3(3), pages 262-271.
  5. Al-mulali, Usama & Fereidouni, Hassan Gholipour & Lee, Janice Y.M., 2014. "Electricity consumption from renewable and non-renewable sources and economic growth: Evidence from Latin American countries," Renewable and Sustainable Energy Reviews, Elsevier, vol. 30(C), pages 290-298.
  6. Neeliah Harris & Deenapanray Prakash, 2012. "The economic growth and electricity consumption nexus: Evidence from Mauritius," Economics Bulletin, AccessEcon, vol. 32(4), pages 2930-2943.
  7. Shahbaz, Muhammad & Salah Uddin, Gazi & Ur Rehman, Ijaz & Imran, Kashif, 2014. "Industrialization, electricity consumption and CO2 emissions in Bangladesh," Renewable and Sustainable Energy Reviews, Elsevier, vol. 31(C), pages 575-586.
  8. Wong, Siang Leng & Chang, Youngho & Chia, Wai-Mun, 2013. "Energy consumption, energy R&D and real GDP in OECD countries with and without oil reserves," Energy Economics, Elsevier, vol. 40(C), pages 51-60.

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