Economic Growth and Electricity Consumption in India: An Econometric Analysis

2021 ◽  
pp. 001946622110624
Author(s):  
Ranjan Aneja ◽  
Megha Mathpal
Keyword(s):  
Causal Relationship ◽  
Urban Population ◽  
Electricity Consumption ◽  
Granger Causality Test ◽  
Capita Gross Domestic Product ◽  
Causality Test ◽  
Jel Codes ◽  
Long Run ◽  
Integration Test ◽  
Per Capita

The purpose of this study is to analyse the long-run causal relationship among the per capita electricity consumption ( PCEC) and per capita gross domestic product ( PCGDP), urban population ( UP) and employment ( EMP) pattern in India over the period of 1991–2018. To analyse the long-run association Johansen co-integration test has been used. The results of the Granger-causality test imply that there exists a bidirectional causal relationship between the PCEC and PCGDP whereas there exist unidirectional causality from EMP and UP to PCGDP. Jel Codes: L52, C53, P1

Does any nexus between electricity consumption and economic growth exist? Evidence from Haryana using VAR model

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Kamaljit Singh
Keyword(s):  
Economic Growth ◽  
Granger Causality ◽  
Renewable Energy Sources ◽  
Electricity Consumption ◽  
Granger Causality Test ◽  
Economic Downturn ◽  
Causality Test ◽  
Content Type ◽  
Long Run ◽  
Per Capita

Purpose In the fast-changing technological environment, electricity is the essence of the world economy and a significant means for all the modern world’s possessions. The ongoing economic downturn focuses on energy’s role in the economy. This study aims to explore the nexuses between per capita electricity usage and per capita state gross domestic product (SGDP) in Haryana, India. Design/methodology/approach The statistics from 1989 to 2015 have been analyzed using Johansen cointegration, vector autoregression and paired Granger-causality test. Findings The Granger causality test results show that a long-run association is absent. A short-run unidirectional relationship runs from per capita SGDP to per capita electricity usage. Practical implications As a policy suggestion, the policymakers may encourage energy conservation measures and renewable energy sources to lead the country’s sustainable energy supply. Moreover, Haryana can increase its influence in this sector and enter rapidly in the growing markets worldwide by stimulating the production and adoption of digital solutions for energy efficiency. Originality/value To the best of the author’s awareness, this research is one of its nature regarding systematically analyzing electricity usage and economic growth relationship in Haryana.

The relationship between energy consumption and gross domestic product in Hong Kong (1992–2015): Evidence from sectoral analysis and implications on future energy policy

2019 ◽  
Vol 31 (2) ◽  
pp. 215-236
Author(s):  
Ruixiaoxiao Zhang ◽  
Geoffrey QP Shen ◽  
Meng Ni ◽  
Johnny Wong
Keyword(s):  
Time Series ◽  
Energy Consumption ◽  
Gross Domestic Product ◽  
Causal Relationship ◽  
Granger Causality ◽  
Value Added ◽  
Granger Causality Test ◽  
Domestic Product ◽  
Causality Test ◽  
Per Capita

The causal relationship between energy consumption and gross domestic product in Hong Kong from 1992 to 2015 is investigated in this study. Different from the previous studies focusing on the causal relationship between total energy consumption and total gross domestic product per capita, this study further investigates the causal relationship from sectoral perspective, including residential, commercial, industrial and transportation sectors. For each sector, the time series data of sectoral energy consumption and sectoral per capita value added are collected. To conduct the Granger causality test, the unit root test is first applied to analyse the stationarity of time series. The cointegration test is then employed to examine whether causal relationship exists in long-term. Finally, based on the aforementioned tests, both vector error correction model and vector autoregression model can be selected to determine the Granger causality between time series. It is interesting to find that the sectoral energy consumption and corresponding sectoral per capita value-added exhibit quite different causal relationships. For both residential sector and commercial sectors, a unidirectional causal relationship is found running from the sectoral per capita value added to sectoral energy consumption. Oppositely, for industrial sector and transportation sector, a unidirectional causal relationship is found running from sectoral energy consumption to sectoral per capita value added. Regarding the Granger causality test results, the indicative suggestions on energy conservation policies, energy efficiency policies and greenhouse gas emission reduction policies are discussed based on the background of Hong Kong’s economic structure and fuel types.

scholarly journals When The Last Tree Dies, The Last Man Dies: Do Forests Hold The Key To Survival In Ghana? A Critical Analysis Using The Bootstrapped Rolling Window Granger Causality Test Approach

2022 ◽  
Author(s):  
Michael Kaku Minlah ◽  
Xibao Zhang ◽  
Philipine Nelly Ganyoh ◽  
Ayesha Bibi
Keyword(s):  
Life Expectancy ◽  
Causal Relationship ◽  
Granger Causality ◽  
Human Life ◽  
Granger Causality Test ◽  
Causality Test ◽  
Vector Borne Diseases ◽  
Long Run ◽  
Rolling Window

Abstract This paper investigates the role of forests in the life expectancy of people in Ghana. We test whether the extinction of forests will inevitably lead to extinction of people in Ghana. We first examined the causal relationship between life expectancy and deforestation using the full sample bootstrap Granger causality test approach and find causality to run from deforestation to life expectancy with no feedback from life expectancy to deforestation. Testing for parameter stability, we found the short run and long run parameters of the estimated Vector Auto Regressive models to be unstable. A time-varying approach, the rolling window bootstrapped Granger causality test was then employed to investigate the causal relationship between life expectancy and deforestation. The results showed that deforestation has a negative effect on life expectancy, confirming the widely accepted saying that the health of forests is inextricably linked to the health of mankind. The empirical results further show that, on trend higher life expectancy increases the rate of deforestation in Ghana. Highlighting the importance of the role of forests in influencing life expectancy in Ghana, we recommend awareness creation on the role of forests in supporting human life and also extensive afforestation programs to reduce the rate of deforestation in Ghana. This, we believe, will reduce the spread of vector borne diseases such as malaria and reduce the surge in respiratory diseases which shorten the life span of Ghanaians.JEL codesQ23, Q50, Q53, Q58, Q58

scholarly journals Financial System Stability and Economic Growth in Nigeria

2020 ◽  
Author(s):  
Isaac Ikeafe NJANG ◽  
Eko Eko OMINI ◽  
Festus Victor BEKUN ◽  
Festus Fatai Adedoyin
Keyword(s):  
Economic Growth ◽  
Financial Crisis ◽  
Financial Stability ◽  
Financial System ◽  
Granger Causality Test ◽  
System Stability ◽  
Causality Test ◽  
Long Run ◽  
Integration Test ◽  
Sustainable Economic Growth

Abstract This study primarily seeks to evaluate the influence of financial system stability on economic growth in Nigeria from 1986 to 2016. Employing the use of Principal Component Analysis (PCA), this study constructs a Financial System Stability Index (FSSI) as measurement for financial stability. The indicators used in building the index capture three sectors of the Nigerian Financial System (NFS). The three sectors cover the banking sector, the capital market, the external sector and include a fourth component representing financial depth. The resulting index serves as a single qualitative measure for evaluating the level of stability in a nation’s financial system and proves capable of warning of an eminent financial crisis. Employing the use of four macroeconomic indicators, the index is then regressed against the Nigerian economic growth rate with an aim of discovering the short-run and long-run dynamics existing between both variables. The granger causality test, Johansson Co-integration test and Vector Error Correction Model (VECM) are the estimation techniques employed in achieving the objectives of this research. The granger causality test revealed a uni-directional causality between financial stability and economic growth in Nigeria. The Johansson Co-integration test showed that long-run co-integration relationship exists between financial stability and economic growth. Finally, the VECM results find that financial stability displays a negative relationship with economic growth and bears no significant effect on economic growth in Nigeria. The findings disclose that financial stability in Nigeria may be high and has resulted in the underutilization of financial assets thus hampering sustainable economic growth in Nigeria. In conclusion, the outcome of the findings shows that while financial stability may be necessary for initiating economic growth, it is not sufficient for sustaining economic growth in Nigeria. This research work recommends that the FSSI be employed as an additional tool for measuring the condition/state of financial stability in Nigeria and in predicting the onset of a potential financial crisis. The study further recommends that financial authorities must give attention to other aspects of financial development to facilitate sustainable economic growth in Nigeria.

scholarly journals Electricity Consumption, Corruption and Economic Growth

2018 ◽  
Vol 6 (4) ◽  
pp. 193-214
Author(s):  
Busrat Abidemi Agbaje ◽  
Ekele Idachaba
Keyword(s):  
Economic Growth ◽  
Causal Relationship ◽  
Electricity Consumption ◽  
Electricity Price ◽  
African Countries ◽  
Causality Test ◽  
Long Run ◽  
Integration Techniques ◽  
Short Run ◽  
Electricity Infrastructure

An important prerequisite for reducing poverty, sustainable development and achievement of the millennium development goal has to some extent been tied to access to electricity. However, the subject matter; 'electricity consumption causing economic growth' has seen conflicting results from the theoretical and empirical front, if indeed a relationship exist at all. The study tests, within a panel context the long-run relationship between electricity consumption and economic growth for 13 African Countries from 2006 to 2017 by employing recently developed panel co-integration techniques. Implementing a three stage approach made up of panel unit root, panel co-integration and Granger causality test to examine the causal relationship between electricity consumption, electricity price, corruption, employment and growth. The study provides empirical evidence that a bidirectional causal relationship between electricity consumption and economic growth exist in the short run, suggesting that lack of electricity could hamper economic growth as well as an investment in electricity infrastructure would in turn improve economic growth. Also reveals that corruption causes the level of electricity consumption and GDP in the short run. On the long-run front electricity consumption and electricity price granger causes GDP and GDP causes electricity consumption.

Dynamic linkages among international crude oil, exchange rate and Norwegian stock market: evidence from ARDL bound testing approach

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Shelly Singhal ◽  
Sangita Choudhary ◽  
Pratap Chandra Biswal
Keyword(s):  
Exchange Rate ◽  
Stock Market ◽  
Crude Oil ◽  
Granger Causality ◽  
Granger Causality Test ◽  
Oil Price ◽  
Causality Test ◽  
Content Type ◽  
Long Run ◽  
Integration Test

Purpose The purpose of this paper is to examine the long-run association and short-run causality among oil price, exchange rate and stock market in Norwegian context. Design/methodology/approach This work uses auto regressive distributed lag (ARDL) bound co-integration test to examine the long-run association among international crude oil, exchange rate and Norwegian stock market. Further to test the causality, Toda–Yamamoto Granger causality test is used. Daily data ranging from 1 January, 2011 to 31 December, 2018 is used in this study. Findings Findings of this study suggest the existence of long-run equilibrium relationship among oil price, exchange rate and Norwegian stock market when oil price is taken as dependent variable. Further, this study observes the bi-directional causality between Norwegian stock market and exchange rate and unidirectional causality between oil and Norwegian stock market (from oil to stock market). Originality/value To the best of the authors’ knowledge, this the first study in context of Norway to explore the long-run association and causal relationships among international crude oil price, exchange rate and stock market index. Particularly, association of exchange rate and stock market largely remains unexplored for Norwegian economy. Further, majority of studies conducted in Norwegian setup have considered the period up to year 2010 and association of these variables is found to be time varying. Finally, this study uses ARDL bound co-integration test and Toda–Yamamoto Granger causality test. These methodologies have been used in literature in context of other countries like India and Mexico but not yet applied to study the Norwegian case.

scholarly journals Global Financial Crisis and Islamic Capital Market Integration among 5-ASEAN Countries

2015 ◽  
Vol 2 (3) ◽  
pp. 207
Author(s):  
Ibnu Qizam ◽  
Abdul Qoyum ◽  
Misnen Ardiansyah
Keyword(s):  
Granger Causality ◽  
Capital Markets ◽  
Capital Market ◽  
Market Integration ◽  
Global Financial Crisis ◽  
Granger Causality Test ◽  
Causality Test ◽  
Long Run ◽  
Integration Test ◽  
Asean Countries

Islamic Capital Market is important part of Financial System in ASEAN countries especially in the context of AEC. The objective of this paper is to investigate interconnection long run equilibrium of Islamic Capital Market in ASEAN Countries. Using daily closing price for from September 2007 to October 2012, this study examine five Islamic Capital markets in ASEAN namely Indonesia, Malaysia, Philippines, Singapore and Thailand. This study examines on Integration among these Islamic Capital markets by relies a simple correlation test, Granger causality test and co-integration test using error correction model. This research documents some interesting finding. First, Using Johansen estimation technique, there is co-integration between the considered Islamic indices namely; Indonesia, Malaysia, Philippines, Singapore and Thailand. Second, Since the co-integration exists, granger causality test shows that there is three bi-directional causalities namely; between Malaysia Islamic Capital Market and Singapore Islamic Capital Market; between Thailand Islamic Capital Market and Singapore Islamic Capital Market; and between Singapore Islamic Capital Market and Philippines Islamic Capital Market. However, there is a unidirectional between Indonesia Islamic Market (MCIINA) and Malaysia Islamic Market (MCIMY), MCIINA and Philippines Islamic Market (MCIPhil), MCIINA and Thailand Islamic Market (MCITHAI), it implies that MCIINA affects MCIMY, MCIPhil, and MCIThai but not vice versa. Third, based on VECM suggest that all Islamic indexes are inter-related in the long run that can be explained due to the similarity of structure bring about by its stock as required by shariah in the process stock screening.

scholarly journals REVISITING KEYNES’ INVESTMENT AND SAVING MODEL IN INDONESIA

2020 ◽  
Vol XVIII (2) ◽  
pp. 45-58
Keyword(s):  
Error Correction ◽  
Causal Relationship ◽  
Granger Causality Test ◽  
Vector Error Correction Model ◽  
Causality Test ◽  
Correction Model ◽  
Vector Error Correction ◽  
Vector Error ◽  
Long Run ◽  
Short Run

This study aims to analyze the Keynes’ investment and saving model in Indonesia from 1981 to 2018. The researchers use the econometric test from the Granger causality test to find the short-run causal relationship and the Vector Error Correction Model to reveal both the short-run and long-run effects in the model. The result of Granger causality test demonstrates that there is no short-run causal relationship between these two variables. In the short-run, the increase in saving affects the consumption loans more compared to the investment loans. Besides, increased consumption compared to saving has more influence in raising investment. However, the Vector Error Correction Model proves that saving negatively affects investment in the long-run. This model empirically supports the long-run Keynes’ investment and saving model. Consequently, the Indonesian government needs to consider saving as a policy instrument to increase investment in the longrun.

scholarly journals Stochastic Pattern of Major Indices of Bombay Stock Exchange

2019 ◽  
Vol 8 (3) ◽  
pp. 6774-6779
Keyword(s):  
Granger Causality ◽  
Stock Exchange ◽  
Granger Causality Test ◽  
Short Term ◽  
Causality Test ◽  
Policy Makers ◽  
Long Run ◽  
Integration Test ◽  
Augmented Dickey Fuller ◽  
Portfolio Managers

It is interesting to get inside and draw a meaningful inference by studying the movement of various stock indices. Portfolio managers, analysts, and investors are very keen to know about the technical pattern of indices. They consider the stock market is one of the economic barometers or market indicators of an economy. Indian financial market has undergone radical and vital change during the past few years. The purpose of this study is to check stochastic movements in selected indices and to signify nexus and interdependency among one another by the virtue of econometric analysis. The study comprises of daily closing value from 1st April 2014-1st April 2018, including major indices i.e. S&P-BSE 100; S&P-BSE-200, S&P BSE-500, S&P-BSE:Large cap, S&P-BSE:Mid-cap, S&P-BSE:small-cap, and BSE-SENSEX. Moreover, typical econometrics tool Augmented Dickey-Fuller Test, Granger Causality Test, and Johansen Co-integration Test were implemented to conclude the result. The study is one of its kinds to analyze the static and pair wise relationship among seven BSE indices along with the direction of their expected future movement that would help practitioners, policy makers and investors in anticipating the future movement of the indices. The Dickey-Fuller and Johanson test administered to analyze unit root and co-integration among the series in long run, followed by Granger causality test to observe the route of the short term relationship among various indices. The tests reveal uni-directional and in some cases bi-directional causality in selected indices. Further, it has been observed that due to co-integration, prices of different indices can’t move far away from one another [1]. This stochastic study delves volatility pattern of some major indices of Bombay stock exchange with the help of econometric tools. It clearly delineates nexus of all the indices and provided an explanation to appreciate concrete conduct of one series into a mutual relationship. Hence, investors or analyst may predict the movements, interdependency and their relationship in a significant manner.

scholarly journals Examining the Causal Relationship between Private Sector Credit Extended and Economic Growth in Namibia

2019 ◽  
Vol 11 (2(J)) ◽  
pp. 23-29
Author(s):  
Andreas . ◽  
J P S Sheefeni
Keyword(s):  
Economic Growth ◽  
Private Sector ◽  
Granger Causality ◽  
Granger Causality Test ◽  
Test Results ◽  
Causality Test ◽  
Long Run ◽  
Integration Test ◽  
Stationarity Test ◽  
Lending Rates

The paper examined causality between Private Sector Credit Extension (PSCE) and Economic growth using quarterly data for the period 2000:Q1-2017:Q4, in Namibia. The variables employed were Gross Domestic Product (GDP), Private Sector Credit Extended, Broad Money Supply (M2) and lending rates. The study tested for stationarity in order to determine the order of integration. Furthermore, a co-integration test was conducted on different sets of variables to establish the long run relationship. Granger causality test was also conducted to establish the direction of the relationships between the variables. The results for the stationarity test showed a combination of different orders of integration. The co-integration test revealed a stable long-run relationship among the variables. The Granger causality test results revealed one-directional causality running from PSCE to GDP. Therefore, one can conclude that that change in private sector credit extended can help predict economic growth.

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