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Renewable and non-renewable energy consumption and economic growth: Evidence from MENA Net Oil Exporting Countries

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  • Kahia, Montassar
  • Ben Aissa, Mohamed Safouane

Abstract

This study investigate the relationship between renewable and non-renewable energy consumption and economic growth in a sample of 13 MENA Net Oil Exporting Countries covering the period 1980–2012 within a multivariate panel framework. The Pedroni (1999, 2004), Kao (1999) as well as the Westerlund (2007) panel cointegration tests indicate that there is a long-run equilibrium relationship between real GDP, renewable energy consumption, non-renewable energy consumption, real gross fixed capital formation, and the labor force with elasticities estimated positive and statistically significant in the long-run. Results from panel error correction model show that there is unidirectional causality from economic growth to renewable energy consumption in the short-run and bidirectional causality in the long-run. Additionally, results prove bidirectional causality between non-renewable energy consumption and economic growth in both the short-run as well as the long-run. In fact, there are several initiatives and policies must be undertaken by Government so as to stimulate the introduction of renewable energy such as the development of several important regional based institutions and cooperation, renewable energy production tax credits, installation rebates for renewable energy systems and the creation of markets for renewable energy certificates.

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  • Kahia, Montassar & Ben Aissa, Mohamed Safouane, 2014. "Renewable and non-renewable energy consumption and economic growth: Evidence from MENA Net Oil Exporting Countries," MPRA Paper 80776, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:80776
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    2. Ajide, Kazeem & Ridwan, Ibrahim, 2018. "Energy consumption, environmental contaminants, and economic growth: The G8 experience," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 51, pages 58-83.

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    More about this item

    Keywords

    Renewable and non-renewable energy consumption; Growth; Panel cointegration; MENA Net Oil Exporting Countries.;
    All these keywords.

    JEL classification:

    • C21 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Cross-Sectional Models; Spatial Models; Treatment Effect Models
    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • Q2 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation
    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy

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