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Are shocks to disaggregated energy consumption in Malaysia permanent or temporary? Evidence from LM unit root tests with structural breaks

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  • Lean, Hooi Hooi
  • Smyth, Russell

Abstract

The objective of this paper is to examine whether energy consumption in Malaysia, disaggregated by sector and type, is stationary or contains a unit root. To realize our objective we apply the Lagrange multiplier (LM) family of unit root tests with up to two structural breaks. Depending on the decision rule for selecting between results in the no-break, one-break and two-break cases, we find that energy consumption is stationary for between 50 per cent and 70 per cent of the disaggregated energy series and between 25 per cent and 50 per cent of sectors. Implications for the Malaysian government's attempts to reduce fossil fuel consumption are discussed.

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Bibliographic Info

Article provided by Elsevier in its journal Renewable and Sustainable Energy Reviews.

Volume (Year): 31 (2014)
Issue (Month): C ()
Pages: 319-328

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Handle: RePEc:eee:rensus:v:31:y:2014:i:c:p:319-328

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Related research

Keywords: Disaggregated energy consumption; Unit root; Structural breaks;

References

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Cited by:
  1. Hooi Hooi Lean & Russell Smyth, 2013. "Will initiatives to promote hydroelectricity consumption be effective? Evidence from univariate and panel LM unit root tests with structural breaks," Development Research Unit Working Paper Series 47-13, Monash University, Department of Economics.

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