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Economic growth and energy consumption in Iran: an ARDL approach including renewable and non-renewable energies

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  • Mohamad Taghvaee, Vahid
  • Mavuka, Clever
  • Khodaparast Shirazi, Jalil

Abstract

Iran experiences a high level of energy consumption which is threatening not only economically but also politically and environmentally. This study aims to estimate the relationship between the economic growth with the various kinds of energies, non-hydroelectric, renewable, non-renewable, and total energies in Iran during 1967–2012, using an autoregressive distributed lags (ARDL) model. The results show the ineffective relationship between the economic growth and energy consumption in Iran, considering non-hydroelectric energy, renewable energy, non-renewable energy, and total energy, one by one as the energy proxy. It implies the ineffectiveness of both the quantitative and qualitative deflationary policies over the energy sector. In another word, neither decreasing energy consumption nor changing energy portfolio affects the economic growth. Therefore, the policy makers are advised to formulate those policies which reduce the quantity of energy consumption or increase the segment of renewable energies in the portfolio of energy consumption because they do not lead to the considerable negative consequence on the economic growth, while they increase both the environmental quality and energy security.

Suggested Citation

  • Mohamad Taghvaee, Vahid & Mavuka, Clever & Khodaparast Shirazi, Jalil, 2016. "Economic growth and energy consumption in Iran: an ARDL approach including renewable and non-renewable energies," MPRA Paper 74323, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:74323
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    References listed on IDEAS

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    1. Pesaran, M.H. & Shin, Y., 1995. "An Autoregressive Distributed Lag Modelling Approach to Cointegration Analysis," Cambridge Working Papers in Economics 9514, Faculty of Economics, University of Cambridge.
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    Cited by:

    1. Amir Iqbal & Xuan Tang & Samma Faiz Rasool, 2023. "Investigating the nexus between CO2 emissions, renewable energy consumption, FDI, exports and economic growth: evidence from BRICS countries," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 25(3), pages 2234-2263, March.
    2. Md. Nazmus Sadekin & Md. Mahbub Alam & Syed Moudud-Ul-Huq & Mohammad Ghozali Hassan & Tarequl Islam, 2021. "Do Energy Consumption and Environmental Degradation (CO2 Emissions) Matter for Economic Growth? Fresh Evidence from a Developing Economy," International Journal of Energy Economics and Policy, Econjournals, vol. 11(5), pages 289-297.
    3. Hamisu Sadi Ali & Malayaranjan Sahoo & Md. Mahmudul Alam & Idris Isma’il Tijjani & Abul Quasem Al-Amin & Adeel Ahmed, 2023. "Structural transformations and conventional energy-based power utilization on carbon emissions: empirical evidence from Pakistan," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 25(3), pages 2419-2442, March.
    4. Vahid Mohamad Taghvaee & Jalil Khodaparast Shirazi & Mohamed Amine Boutabba & Alireza Seifi Aloo, 2017. "Economic Growth and Renewable Energy in Iran," Iranian Economic Review (IER), Faculty of Economics,University of Tehran.Tehran,Iran, vol. 21(4), pages 789-808, Autumn.
    5. Jalil Khodaparast Shirazi & Vahid Mohamad Taghvaee & Mohamad Nasiri & Abbas Assari Arani, 2020. "Sustainable development and openness in oil-exporting countries: green growth and brown growth," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 9(1), pages 1-19, December.
    6. Zahra Nasrollahi & Mohadeseh-sadat Hashemi & Saeed Bameri & Vahid Mohamad Taghvaee, 2020. "Environmental pollution, economic growth, population, industrialization, and technology in weak and strong sustainability: using STIRPAT model," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 22(2), pages 1105-1122, February.
    7. Vahid Mohamad Taghvaee & Abbas Assari Arani & Susanne Soretz & Lotfali Agheli, 2023. "Diesel demand elasticities and sustainable development pillars of economy, environment and social (health): comparing two strategies of subsidy removal and energy efficiency," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 25(3), pages 2285-2315, March.

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    More about this item

    Keywords

    Economic growth; Energy consumption; Renewable energies; Non-renewable energies; Iran;
    All these keywords.

    JEL classification:

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

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