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Disaggregate energy consumption and industrial output in Pakistan: An empirical analysis

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  • Qazi, Ahmer Qasim
  • Ahmed, Khalid
  • Mudassar, Muhammad

Abstract

The study concentrates on the relationship between disaggregate energy consumption and industrial output in Pakistan by utilizing the Johansen Method of Cointegration. The results confirm the positive effect of disaggregate energy consumption on industrial output. Furthermore, bidirectional causality is identified in the case of oil consumption, whereas unidirectional causality running from electricity consumption to industrial output is observed. Moreover, unidirectional causality has been noticed from industrial output to coal consumption although there is no causality between gas consumption and industrial output. It is obvious that conservative energy policies could be harmful to the industrial production; therefore, the government has to develop innovative energy policies in order to meet the demand for energy. Additionally, the government has to pay serious attention to alternative energy sources such as solar and wind in order to boost the clean industrial growth. --

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Bibliographic Info

Paper provided by Kiel Institute for the World Economy in its series Economics Discussion Papers with number 2012-29.

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Date of creation: 2012
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Handle: RePEc:zbw:ifwedp:201229

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Keywords: disaggregate energy consumption; industrial output; Johansen cointegration test;

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  1. 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.
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Cited by:
  1. 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.
  2. Shahbaz, Muhammad & Abosedra, Salah & Sbia, Rashid, 2013. "Energy Consumption, Financial Development and Growth: Evidence from Cointegration with unknown Structural breaks in Lebanon," MPRA Paper 46580, University Library of Munich, Germany.

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