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Hydroelectricity Consumption and Economic Growth Nexus: Evidence from a Panel of Ten Largest Hydroelectricity Consumers

Author

Listed:
  • Nicholas Apergis

    (Northumbria University, Newcastle upon Tyne, U.K.)

  • Tsangyao Chang

    (Department of Finance, Feng Chia University, Taichung, Taiwan)

  • Rangan Gupta

    (Department of Economics, University of Pretoria)

  • Emmanuel Ziramba

    (Department of Economics, University of Namibia, Private Bag 13301, Pioneerspak, Windhoek, Namibia)

Abstract

This paper explores the long-run and causal relationships between hydroelectricity consumption and economic growth for a panel of the 10 largest hydroelectricity consuming countries over the period 1965 to 2012. The countries include Brazil, Canada, China, France, India, Japan, Norway, Sweden, Turkey and the U.S.A. Using the Bai and Perron (2003) tests for cointegration, the results indicate that real GDP per capita and hydroelectricity consumption per capita appear to be cointegrated around a broken intercept. Granger causality results from a nonlinear panel smooth transition vector error correction model suggest different results depending on the regime. For the pre-1988 period, there is evidence of unidirectional causality running from real GDP per capita to hydroelectricity per capita in both the short- and long-run. Over the post-1988 period, there exists evidence of bidirectional causality between hydroelectricity energy consumption per capita and real GDP per capita in both the short- and the long-run.

Suggested Citation

  • Nicholas Apergis & Tsangyao Chang & Rangan Gupta & Emmanuel Ziramba, 2015. "Hydroelectricity Consumption and Economic Growth Nexus: Evidence from a Panel of Ten Largest Hydroelectricity Consumers," Working Papers 201538, University of Pretoria, Department of Economics.
    • Handle: RePEc:pre:wpaper:201538
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    9. Khraief, Naceur & Shahbaz, Muhammad & Mallick, Hrushikesh & Loganathan, Nanthakumar, 2016. "Estimation of Electricity Demand Function for Algeria: Revisit of Time Series Analysis," MPRA Paper 74870, University Library of Munich, Germany, revised 01 Nov 2016.
    10. Solarin, Sakiru Adebola & Shahbaz, Muhammad & Hammoudeh, Shawkat, 2019. "Sustainable economic development in China: Modelling the role of hydroelectricity consumption in a multivariate framework," Energy, Elsevier, vol. 168(C), pages 516-531.
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    12. Bildirici, Melike E. & Gökmenoğlu, Seyit M., 2017. "Environmental pollution, hydropower energy consumption and economic growth: Evidence from G7 countries," Renewable and Sustainable Energy Reviews, Elsevier, vol. 75(C), pages 68-85.
    13. Can Tansel Tugcu & Angeliki N. Menegaki & Ilhan Ozturk, 2020. "Renewable Vs Non-Renewable Energy Consumption as a Driver of Government Deficit in Net Energy Importing Countries," Asian Economic and Financial Review, Asian Economic and Social Society, vol. 10(10), pages 1100-1114, October.
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    15. Jose Erazo & Guillermo Barragan & Modesto Pérez-Sánchez & Clotario Tapia & Marco Calahorrano & Victor Hidalgo, 2022. "Geometrical Optimization of Pelton Turbine Buckets for Enhancing Overall Efficiency by Using a Parametric Model—A Case Study: Hydroelectric Power Plant “Illuchi N2” from Ecuador," Energies, MDPI, vol. 15(23), pages 1-18, November.
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    Keywords

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    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • Q25 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Water
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

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