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Economic Growth and Electricity Consumption in Africa and Asia: MS-VAR and MS-GRANGER Causality Analysis

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  • Bildirici, Melike

Abstract

Knowledge of the direction of the causality between electricity consumption and economic growth is of primary importance if appropriate energy policies and energy conservation measures are to be devised.This study estimates the causality relationship between electricity consumption and economic growth by Markov Switching Vector Auto Regression (VAR) and Markov Switching Granger Causality methods for some emerging countries; Brunei, Cameron, Côte d'Ivoire, Nigeria, South Africa, Togo and Zimbabwe. The results from MS-VAR models show that in regime one, two and three, Electricity Consumption (EC) is the Granger cause of the Gross Domestic Product (GDP) and GDP is the Granger cause of the EC. In sum, we find some evidence of bidirectional GC between the EC and the GDP.

Suggested Citation

  • Bildirici, Melike, 2012. "Economic Growth and Electricity Consumption in Africa and Asia: MS-VAR and MS-GRANGER Causality Analysis," MPRA Paper 40515, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:40515
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    File URL: https://mpra.ub.uni-muenchen.de/41796/1/MPRA_paper_41796.pdf
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    References listed on IDEAS

    as
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    Citations

    Blog mentions

    As found by EconAcademics.org, the blog aggregator for Economics research:
    1. Which comes first: electricity or economic growth?
      by Economic Logician in Economic Logic on 2012-09-04 20:24:00

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    Cited by:

    1. Cowan, Wendy N. & Chang, Tsangyao & Inglesi-Lotz, Roula & Gupta, Rangan, 2014. "The nexus of electricity consumption, economic growth and CO2 emissions in the BRICS countries," Energy Policy, Elsevier, vol. 66(C), pages 359-368.
    2. Apergis, Nicholas & Polemis, Michael, 2018. "Electricity supply shocks and economic growth across the US states: evidence from a time-varying Bayesian panel VAR model, aggregate and disaggregate energy sources," MPRA Paper 84954, University Library of Munich, Germany.
    3. Dogan, Eyup, 2015. "The relationship between economic growth and electricity consumption from renewable and non-renewable sources: A study of Turkey," Renewable and Sustainable Energy Reviews, Elsevier, vol. 52(C), pages 534-546.
    4. Menegaki, Angeliki N. & Tugcu, Can Tansel, 2017. "Energy consumption and Sustainable Economic Welfare in G7 countries; A comparison with the conventional nexus," Renewable and Sustainable Energy Reviews, Elsevier, vol. 69(C), pages 892-901.
    5. repec:eee:rensus:v:80:y:2017:i:c:p:531-537 is not listed on IDEAS
    6. repec:rjr:romjef:v::y:2017:i:4:p:22-46 is not listed on IDEAS
    7. Kais Saidi & Sami Hammami, 2016. "Economic growth, energy consumption and carbone dioxide emissions: recent evidence from panel data analysis for 58 countries," Quality & Quantity: International Journal of Methodology, Springer, vol. 50(1), pages 361-383, January.
    8. Kais Saidi & Sami Hammami, 2016. "Economic growth, energy consumption and carbone dioxide emissions: recent evidence from panel data analysis for 58 countries," Quality & Quantity: International Journal of Methodology, Springer, vol. 50(1), pages 361-383, January.

    More about this item

    Keywords

    Economic Growth; Electricity Consumption; MS-VAR; MS-Granger Causality;

    JEL classification:

    • C0 - Mathematical and Quantitative Methods - - General
    • N7 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services

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