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The Role of Information Communication Technology and Economic Growth in Recent Electricity Demand: Fresh Evidence from Combine Cointegration Approach in UAE

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  • Shahbaz, Muhammad
  • Sbia, Rashid
  • HAMDI, Helmi
  • Ur Rehman, Ijaz

Abstract

This paper investigates relationship between information communication technology (ICT), economic growth and electricity consumption using data of UAE over the period of 1975-2011.We have tested the unit properties of variables and the Bayer and Hanck combined cointegration approach for long run relationship. The innovative accounting approach is applied to test the robustness of the VECM Granger causality findings. Our empirical results confirm the existence of cointegration between the series. We find that ICT adds in electricity demand but electricity prices lower it. Income growth increases electricity consumption. The non-linear relationship between ICT and electricity consumption is an Inverted U-shaped. The causality results reveal that ICT and electricity prices Granger cause electricity demand. The feedback effect exists between economic growth and electricity consumption

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 53226.

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Date of creation: 16 Jan 2014
Date of revision: 25 Jan 2014
Handle: RePEc:pra:mprapa:53226

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Keywords: ICT; Growth; Electricity; UAE;

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  1. Susanto Basu & John G. Fernald & Nicholas Oulton & Sylaja Srinivasan, 2003. "The Case of the Missing Productivity Growth: Or, Does Information technology explain why productivity accelerated in the United States but not the United Kingdom?," Harvard Institute of Economic Research Working Papers 2021, Harvard - Institute of Economic Research.
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