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Analysis of renewable and nonrenewable energy consumption, real GDP and CO2 emissions: A structural VAR approach in Romania

Author

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  • Muhammad Shahbaz

    (COMSATS Institute of Information Technology, Lahore Campus, Pakistan)

  • Muhammad Zeshan

    (School of Economics, Quaid-e-Azam University, Islamabad, Pakistan)

  • Aviral Kumar Tiwari

    (Faculty of Management Studies, ICFAI University, Tripura, India)

Abstract

Impulse responses of our structural VAR portray a positive correlation between the real GDP of Romania and energy consumption. The present study employs the annual data covering the period 1980-2008, and brings to light the factors playing important role in satisfying the energy requirements, its economic and social implications. Any short-run rise in energy requirements is contented with the help of nonrenewable energy consumption, for renewable energy is not so common in Romania. In addition, high installation cost and the ignorance about our environmental responsibilities etc. might be other possible factors for this limited use of renewable energy. It also identifies a strong positive correlation between the nonrenewable energy consumption and the CO2 emissions; resultantly, CO2 piles on in the ecosystem as the nonrenewable energy consumption boosts up. This exaggeration of the CO2 emissions ever time paves some way for the renewable energy which appears to play a minor role at this stage. Impulse responses represent some weak substitution between the nonrenewable energy consumption with the renewable energy consumption, which lowers carbon emissions and communicates some positive message.

Suggested Citation

  • Muhammad Shahbaz & Muhammad Zeshan & Aviral Kumar Tiwari, 2015. "Analysis of renewable and nonrenewable energy consumption, real GDP and CO2 emissions: A structural VAR approach in Romania," Bulletin of Energy Economics (BEE), The Economics and Social Development Organization (TESDO), vol. 3(3), pages 105-118, September.
  • Handle: RePEc:ijr:beejor:v:3:y:2015:i:3:p:105-118
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    Cited by:

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    2. Zeb, Raheel & Salar, Laleena & Awan, Usama & Zaman, Khalid & Shahbaz, Muhammad, 2014. "Causal links between renewable energy, environmental degradation and economic growth in selected SAARC countries: Progress towards green economy," Renewable Energy, Elsevier, vol. 71(C), pages 123-132.

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    More about this item

    Keywords

    Energy; Growth; Emissions; Pakistan;
    All these keywords.

    JEL classification:

    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy

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