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Causality between Energy Consumption and GDP: Evidence from 30 OECD and 78 Non-OECD Countries

Author

Listed:
  • Jaruwan Chontanawat

    (Surrey Energy Economics Centre (SEEC), Department of Economics, University of Surrey)

  • Lester C Hunt

    () (Surrey Energy Economics Centre (SEEC), Department of Economics, University of Surrey)

  • Richard Pierse

    (Department of Economics, University of Surrey)

Abstract

Energy arguably plays a vital role in economic development. Hence many studies have attempted to test for causality between energy and economic growth; however, no consensus has emerged. This paper, therefore, tests for causality between energy and GDP using a consistent data set and methodology for 30 OECD and 78 non-OECD countries. Causality from aggregate energy consumption to GDP and GDP to energy consumption is found to be more prevalent in the developed OECD countries compared to the developing non-OECD countries; implying that a policy to reduce energy consumption aimed at reducing emissions is likely to have greater impact on the GDP of the developed rather than the developing world.

Suggested Citation

  • Jaruwan Chontanawat & Lester C Hunt & Richard Pierse, 2006. "Causality between Energy Consumption and GDP: Evidence from 30 OECD and 78 Non-OECD Countries," Surrey Energy Economics Centre (SEEC), School of Economics Discussion Papers (SEEDS) 113, Surrey Energy Economics Centre (SEEC), School of Economics, University of Surrey.
  • Handle: RePEc:sur:seedps:113
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    File URL: http://www.seec.surrey.ac.uk/Research/SEEDS/SEEDS113.pdf
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    References listed on IDEAS

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    More about this item

    Keywords

    Energy; GDP; Development; Causality; Modelling;

    JEL classification:

    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

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