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The Relationship between Electricity Consumption, Foreign Direct Investment and Economic Growth: Case of Benin

Author

Listed:
  • Desire Wade Atchike

    (School of Economics and Management, North China Electric Power University, Beijing 102206, China,)

  • Zhen-Yu Zhao

    (School of Economics and Management, North China Electric Power University, Beijing 102206, China,)

  • Geriletu Bao

    (Inner Mongolia Technical College of Construction, Huimin 010070, China.)

Abstract

Using the autoregressive distributed lag (ARDL) bounds test with dummy variables and the Toda-Yamamoto approach; this paper investigated the relationship between electricity consumption, foreign direct investment and economic growth in Benin for the period of 1980-2014. Confirming the growth theory for Benin, the results show evidence of unidirectional causalities from electricity consumption to both economic development and foreign direct investment and a long run relationship with a speed of adjustment of 60.72%. These findings suggest that the government of Benin should target the implementation of new strategies to improve access to electricity in order to attract more foreign investment and achieve a rapid and sustainable economic growth.

Suggested Citation

  • Desire Wade Atchike & Zhen-Yu Zhao & Geriletu Bao, 2020. "The Relationship between Electricity Consumption, Foreign Direct Investment and Economic Growth: Case of Benin," International Journal of Energy Economics and Policy, Econjournals, vol. 10(4), pages 507-515.
    • Handle: RePEc:eco:journ2:2020-04-63
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    Cited by:

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    2. Mensah, Johnson Herlich Roslee & dos Santos, Ivan Felipe Silva & Tiago Filho, Geraldo Lúcio, 2023. "A critical analysis of the energy situation in the Benin Republic and its evolution over the last decade," Renewable Energy, Elsevier, vol. 202(C), pages 634-650.

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    More about this item

    Keywords

    Electricity Consumption; Foreign Direct Investment; Economic Growth; Benin.;
    All these keywords.

    JEL classification:

    • F21 - International Economics - - International Factor Movements and International Business - - - International Investment; Long-Term Capital Movements
    • F43 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Economic Growth of Open Economies
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

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