IDEAS home Printed from https://ideas.repec.org/a/rfe/zbefri/v27y2009i2p327-348.html
   My bibliography  Save this article

Causality between economic growth and energy consumption in Croatia

Author

Listed:
  • Tomislav Gelo

    () (University of Zagreb, Faculty of Economics & Business Zagreb, Croatia)

Abstract

The main goal of the paper is to investigate relation between economic development and energy consumption in Croatia. This paper examines the casual relationship, using Granger test, between gross domestic products (GDP) and total primary energy consumption in Croatia. Analyzed period is from 1953 to 2005. In the paper vector auto-regression model (VAR), Granger causality test and unit root test are used as tools for analysis. Economic and energetic time series usually have the problem of non stationarity series. Non-stationary time series are trying stationarity with differentiation of variables, using co-integration technique. Applying Granger’s causality test in Croatian case, we found that GDP Granger causes total energy consumption not energy consumption Granger causes GDP. The result shows that relationship for Croatia runs from total primary energy consumptions to gross domestic products, not from gross domestic products to primary energy consumption. Conclusion of VAR model is that variable total primary energy consumptions and the constant are not significant in the model and that variable gross domestic products is significant. Base conclusion of the paper is that VAR model evaluation shows that change of GDP of 1% in period t-1 would affect the annual total primary energy consumption for 0,509% in period t.

Suggested Citation

  • Tomislav Gelo, 2009. "Causality between economic growth and energy consumption in Croatia," Zbornik radova Ekonomskog fakulteta u Rijeci/Proceedings of Rijeka Faculty of Economics, University of Rijeka, Faculty of Economics, vol. 27(2), pages 327-348.
  • Handle: RePEc:rfe:zbefri:v:27:y:2009:i:2:p:327-348
    as

    Download full text from publisher

    File URL: https://www.efri.uniri.hr/sites/efri.hr/files/cr-collections/2/gelo-2009-2.pdf
    Download Restriction: no

    References listed on IDEAS

    as
    1. Kwiatkowski, Denis & Phillips, Peter C. B. & Schmidt, Peter & Shin, Yongcheol, 1992. "Testing the null hypothesis of stationarity against the alternative of a unit root : How sure are we that economic time series have a unit root?," Journal of Econometrics, Elsevier, vol. 54(1-3), pages 159-178.
    2. Perron, Pierre, 1988. "Trends and random walks in macroeconomic time series : Further evidence from a new approach," Journal of Economic Dynamics and Control, Elsevier, vol. 12(2-3), pages 297-332.
    3. repec:dau:papers:123456789/120 is not listed on IDEAS
    4. Perron, Pierre, 1989. "The Great Crash, the Oil Price Shock, and the Unit Root Hypothesis," Econometrica, Econometric Society, vol. 57(6), pages 1361-1401, November.
    5. Lee, Chien-Chiang, 2005. "Energy consumption and GDP in developing countries: A cointegrated panel analysis," Energy Economics, Elsevier, vol. 27(3), pages 415-427, May.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Gurgul, Henryk & Lach, lukasz, 2011. "The role of coal consumption in the economic growth of the Polish economy in transition," Energy Policy, Elsevier, vol. 39(4), pages 2088-2099, April.
    2. Borozan, Djula, 2013. "Exploring the relationship between energy consumption and GDP: Evidence from Croatia," Energy Policy, Elsevier, vol. 59(C), pages 373-381.
    3. Nela Vlahinic & Pavle Jakovac, 2014. "Revisiting the Energy Consumption-Growth Nexus for Croatia: New Evidence from a Multivariate Framework Analysis," Contemporary Economics, University of Finance and Management in Warsaw, vol. 8(4), December.

    More about this item

    Keywords

    GDP; growth; energy; consumption; Granger causality;

    JEL classification:

    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:rfe:zbefri:v:27:y:2009:i:2:p:327-348. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Antica Sergovic). General contact details of provider: http://edirc.repec.org/data/efrijhr.html .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.